International

Bankrupt Sri Lanka calls upon diaspora to send cash 

A vendor prepares a bag for a customer at a wholesale market, amid the country’s economic crisis in Colombo, Sri Lanka, on April 13, 2022.

A vendor prepares a bag for a customer at a wholesale market, amid the country’s economic crisis in Colombo, Sri Lanka, on April 13, 2022. | Photo Credit: Reuters

Sri Lanka urged its citizens overseas to send home money to help pay for desperately needed food and fuel on Wednesday after announcing a default on its $51 billion foreign debt.

The island nation is in the grip of its worst economic crisis since independence in 1948, with severe shortages of essential goods and regular blackouts causing widespread hardship.

Authorities are weathering intense public anger and spirited protests demanding the government’s resignation ahead of negotiations for an International Monetary Fund bailout.

Central bank governor Nandalal Weerasinghe said he needed Sri Lankans abroad to “support the country at this crucial juncture by donating much needed foreign exchange”.

His appeal came a day after the government announced it was suspending repayments on all external debt, which will free up money to replenish scant supplies of petrol, pharmaceuticals and other necessities.

Accounts set up

Mr. Weerasinghe said he had set up bank accounts for donations in the United States, Britain and Germany and promised Sri Lankan expatriates the money would be spent where it was most needed.

The bank “assures that such foreign currency transfers will be utilised only for the importation of essentials, including food, fuel and medicines”, Mr. Weerasinghe said in a statement.

Tuesday’s default announcement will save Sri Lanka about $200 million in interest payments falling due on Monday, he said, adding that the money would be diverted to pay for essential imports.

Mr. Weerasinghe’s appeal has so far been greeted with scepticism from Sri Lankans abroad. “We don’t mind helping, but we can’t trust the government with our cash,” a Sri Lankan doctor in Australia said, asking for anonymity.


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Printable version | Jun 25, 2022 1:39:54 pm | https://www.thehindu.com/news/international/bankrupt-sri-lanka-calls-upon-diaspora-to-send-cash/article65318189.ece