Crisis-hit Sri Lanka records sharp inflation drop

Trade union members protest over the government’s debt restructuring affecting the income of the pension funds, in Colombo on July 25, 2023. (Photo by AFP)

Agence France-Presse

Crisis-hit Sri Lanka’s inflation moderated to 6.3 percent in July, official figures showed Monday, its lowest rate in nearly two years.

The island’s worst-ever economic turmoil saw widespread shortages and the ouster of its president, with inflation peaking at 69.8 percent last September.

But it has fallen since then, reaching 12.0 percent in June before dropping further in July, when data from the department of Census and Statistics showed a decline in food prices.

Sri Lanka defaulted on its $46 billion foreign debt in April 2022 and many of its 22 million people endured months of food, fuel, and medicine shortages.

The foreign exchange shortage has somewhat eased since, with the government securing a $2.9 billion bailout from the International Monetary Fund in March.

Last month, the government unveiled a debt restructuring plan which offered a 30 percent haircut for international sovereign bondholders, who account for more than a quarter of Sri Lanka’s outstanding foreign obligations.

The IMF said last month that Sri Lanka’s economy showed “tentative signs of improvement” but warned Colombo still needed to pursue painful reforms.

Last year’s economic crisis sparked months of civil unrest which eventually toppled then-president Gotabaya Rajapaksa.

His successor Ranil Wickremesinghe has doubled taxes, removed generous subsidies on energy, and sharply raised prices to shore up state revenue. -ag

Popular

PBBM expands social protection access for gov’t COS, JO workers

By Darryl John Esguerra | Philippine News Agency President Ferdinand R. Marcos Jr. has expanded access to social protection programs for contract of service (COS)...

PBBM champions discipline, waste-to-energy program, adequate facilities as key to resolving garbage dilemma

By Dean Aubrey Caratiquet In the wake of a voluminous downpour that has drenched Metro Manila with almost a month’s worth of rain, concerned agencies...

OCD, DSWD issue updates on effects of Habagat and Tropical Cyclones Luis, Maymay

By Dean Aubrey Caratiquet After convening for a situation briefing with President Ferdinand R. Marcos Jr. earlier Monday, the Office of Civil Defense (OCD) and...

PBBM enjoins Filipinos to celebrate ASEAN Day with fervor, optimism

By Dean Aubrey Caratiquet As the Philippines continues to navigate a world laced with uncertainty and turmoil, the need for international alliances that mutually benefit...