Sri Lankan Prime Minister Ranil Wickremesinghe has said the country’s economy has “collapsed”, leaving it unable to pay for essential commodities such as oil imports.
It follows months of food, fuel and electricity shortages, and the finding that even the credit lines of neighboring India that the country has maintained so far will not be enough.
Wickremesinghe told the Sri Lankan parliament: “We are now facing a much more serious situation beyond the mere shortage of fuel, gas, electricity and food.
“Our economy has collapsed completely, this is the most serious problem we have today.”
Wickremesinghe said the state-owned Ceylon Petroleum Corporation has a debt of $ 700 million (£ 572 million) and added: “As a result, no country or organization in the world is willing to provide us with fuel.
“They are even reluctant to provide cash fuel.”
Sri Lanka has been struggling with the weight of its debt, combined with the impacts of the coronavirus pandemic, including a loss of tourist revenue and rising commodity costs.
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Wickremesinghe said efforts to turn the situation around had failed, adding: “If at least steps had been taken to curb the collapse of the economy at first, we would not be facing this difficult situation today.
“It simply came to our notice then.
“We are now seeing signs of a possible fall to the bottom.”
Last month, Wickremesinghe blamed the previous government for the problems, accusing them of “ruining the economy”.
Former Prime Minister Mahinda Rajapaksa resigned in May after months of protests and clashes between government supporters and those demanding a change of leadership.
This brought veteran Wickremesinghe to the role for the sixth time, as opposition politicians said he aimed to protect President Gotabaya Rajapaksa and his family from the wrath of protesters.