IMF monitoring situation in Sri Lanka, concerned over rising social tension & violence

As Sri Lanka is grappling with economic and political crisis, the International Monetary Fund (IMF) on Wednesday stated that it is "closely" monitoring the developments in the country after anti-government protests took a violent turn. In a statement released by the apex financial body, the authorities affirmed their commitment to assisting the debt-ridden nation in line with its provisions. Further, IMF will also continue technical level discussions in order to draft new policies following the formation of the new government.

"On our virtual mission during May 9 to 23, discussions at technical level have just started and continued as planned so as to be fully prepared for policy discussions once a new government has been formed," the IMF said, as quoted by the Colombo Gazette.

Talks between the IMF and the crisis-hit Sri Lankan government commenced in April in Washington. Colombo has relied on international partners for help as the economic situation deteriorated pushing the country to the edge of bankruptcy. The island nation is now looking forward to a Rapid Finance Instrument (RFI) as well as a larger Extended Fund Facility (EFF) to help reverse its foreign exchange crunch, which is one of the main contributors to the economic collapse. During the last meeting, the IMF promised a sum ranging from $300 million to $500 million to help Sri Lanka emerge from the crisis.  

Sri Lankan PM resigns amid political deadlock

Sri Lanka currently has an outstanding foreign debt of £51 billion. In the wake of the worst-in-a-decade economic turmoil, Colombo said it will suspend repayment of foreign loans after its foreign currency reserves plummeted below $50 million. Sri Lanka has to pay $7 billion in foreign debts by the end of this year and $25 billion by 2026.

The island nation is grappling to meet basic supplies for its 22 million citizens amid an escalating foreign exchange deficit, which has caused prices of food and fuel prices to shoot up and led to gas shortages. According to experts, the economic crisis has resulted from manhandling of funds and ill-managed taxes.

As the country battles economic and civil strife, Mahinda Rajapaksa on Monday placed his resignation from the prime ministership days after protestors demanded his step down. As per reports, the resignation was tendered following a comprehensive discussion among party ruling SLPP leaders. He faced massive public wrath during his visit to the sacred city of Anuradhapura. Notably, the political crisis unfolded after 26 cabinet ministers of the Rajapaksa government resigned amid economic collapse.

Bar Association of Sri Lanka calls for actions against perpetrators

Sri Lanka witnessed violence on May 9, where 8 people lost their lives and over 200 were injured. The violent clashes erupted between pro and anti-government protestors in Temple Trees (Sri Lanka PM's residence) and Galle Face (Sri Lanka President's residence).  Noting the chaos, the Bar Association of Sri Lanka (BASL) called for immediate and stringent steps against the perpetrators. The attacks on the protest site sparked an extraordinary outburst of violence against many people, including Members of Parliament and local government officials, resulting in deaths, injuries, and the destruction of public and private property.  

(Image: AP)