Going to IMF best solution, says Ranil

UNP leader Ranil Wickremesinghe insists that a programme with the International Monetary Fund (IMF) is necessary to mitigate impact of the growing debt repayment crisis; homegrown solutions are not effective.

“Unlike in the past, Sri Lanka’s debt problem has increased at a time when there is a global debt problem. This makes the situation more challenging and complex. Sri Lanka is a highly import-dependent economy,” Wickremesinghe said during a panel discussion, organised by the International Chamber of Commerce Sri Lanka on Saturday.

The UNP leader said that the government shouldn’t sell state assets to ease off the shortage of foreign exchange to have breakfast but reinvest those proceeds back in the economy. “Going to the IMF is the best solution,” Wickremesinghe said.

With reference to homegrown solutions, he referred to the mess caused by the government in promoting Dhammika peniya as one of the failed measures earlier on to curb the spread of the COVID-19 pandemic.

The former Prime Minister said that Sri Lanka should use the current situation to forge ahead with structural and public sector reforms which were postponed due to political considerations in the past.

The former PM suggested that the re-opening of the country be delayed till mid-October.

In responding to the issue of debt management in Sri Lanka, the UNP leader said that the most pressing concern is addressing the dwindling foreign exchange reserves of the country.

He explained that the regional foreign exchange reserves were projected to increase over the course of the year, however, Sri Lanka’s foreign exchange reserves were on a downward trend.

He also said that economic recovery based on a resurgence of the tourism industry would be uncertain, and until airline ticket prices were reduced it was unlikely that tourist arrivals would increase significantly.