Sri Lanka will receive $300m to $600m from the World Bank over the next four months to buy medicine and other essential items, the country’s finance minister said Friday, as the Indian ocean island suffers its worst economic crisis in decades.
Finance Minister Ali Sabri, who is in Washington to negotiate a rescue package with the International Monetary Fund, said in a video conference that the talks with the IMF might take some time, and that the World Bank has agreed to provide support in the meantime.
Neighboring India has also agreed to provide $500m to buy fuel, and negotiations are under way on an additional $1bn from New Delhi, which has already provided a credit line of $1bn, Sabri said. Sri Lanka has to pay nearly $7bn of its total $25bn in foreign debt due for repayment this year. A severe shortage of foreign exchange means the country lacks the money to buy imported goods.
Sri Lankans have endured months of shortages of essentials such as food, cooking gas, fuel and medicine, lining up for hours to buy the limited stocks available. Fuel prices have risen several times in recent months, resulting in sharp increases in transport costs and prices of other goods. There was another round of increases earlier this week.
The government has announced it is suspending repayment of foreign loans pending the talks with the IMF.
by Daily News Sri Lanka
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