Responding to former Sri Lankan Prime Minister Ranil Wickremesinghe's call for Sri Lanka to seek financial support from the US-backed International Monetary Fund Government Minister Vasudeva Nanayakkara maintained that he would rather the government be destroyed than turn to the IMF.
“Even if we die, we will not seek assistance from the IMF. This is the final thing I have to say. Even if this Government, our Government gets destroyed, we are not prepared to reach out to the IMF and destroy the lives of our people,” he stated.
The statement comes as Sri Lanka continues to grapple with an ongoing economic crisis which has seen average food prices increase an estimated 63% in the past month. Earlier this year a Bloomberg model reported that Sri Lanka’s default probability was the highest in Asia with the organisation estimating a 27.9% chance of one-year default. Sri Lanka owes at least $2.5 billion in debt over the next 12 months.
In his plea, Wickremesinghe stated:
"Reach out to the IMF. I will not say do not go to the IMF. Once you seek their assistance they will state all the conditions. You will not lose employment opportunities through this. They will conduct an inquiry initially. One requirement. Here we have multiple issues here”.
At the start of this year, Sri Lanka’s Central Bank Governor, Weligamage Don Lakshman, rejected the possibility of turning to the IMF for support. IMF’s prescriptions which include fiscal consolidation and removing caps on borrowing costs would undermine Sri Lanka’s sovereignty. Instead of turning to the IMF, Sri Lanka has increasingly turned to support from Bangladesh and China.
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