Economic woes to last another year: SL Prez

Colombo, August 6

President Ranil Wickremesinghe has said Sri Lanka’s economic woes would last another year and it would have to think outside the box and look at new sectors like logistics and nuclear energy to revive the bankrupt economy. Speaking at a two-day conference titled “Let’s reset Sri Lanka” held on Friday, Wickremesinghe said reforms in the country also would need higher taxation.

“For another six months or a year, we will have to go through hard time,” he said.

Wickremesinghe, who has previously described Sri Lanka’s economy as bankrupt, said that economic reforms would require higher taxation. “Even taxation on wealth, we have to resort to those measures, first for economic recovery and second for social stability,” he said.

The president also said the country will have to consider getting into the nuclear energy sector. “More you have more energy you can sell to India, at the same time keep more renewable energy available. We have to think outside the box,” he said.

Having declared an international debt default in April, Sri Lanka is currently negotiating with the International Monetary Fund for a possible bailout package.

However, the IMF programme has hit a snag in the form of restructuring of debt. Even the World Bank has refused to provide any aid until a detailed macroeconomic policy is in place. Referring to the ongoing IMF bailout attempt, Wickremesinghe said the legal and technical advisers on debt restructuring are moving ahead with the task.

“First the foreign debt….and when you look at the official debt are we getting caught into the geopolitics of the region of Asia?,” he said.