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Sri Lanka seeks to deepen economic ties with Iran

Hashem Asjazadeh (pictured left) and G.L. Periris (pictured right)

Sri Lanka Foreign Minister G.L. Peiris met with the ambassador of the Iran, Hashem Asjazadeh where discussions surrounding greater economic cooperation were held.

Peiris stressed that greater cooperation with Iran could include enhanced bilateral trade, investment and the possibility of partnerships in new sectors such as tourism and energy.  The Foreign Minister highlighted the long-standing friendly relations between Sri Lanka and Iran which 'have a proud legacy of two ancient and great civilisations'. Ambassador Ashjazadeh assured the firm commitment and support of the Government of the Islamic Republic of Iran to the expansion of bilateral cooperation with the government of Sri Lanka. 

Sri Lanka's economic woes

Sri Lanka with rising debt repayments faces a foreign exchange crisis that has been exacerbated by the pandemic which has lost an estimated Rs. 1.6 trillion in revenue for the country. The country which has been plagued by nepotism, corruption and failed fiscal policy has led to growing unrest throughout Sri Lanka and the northeast, which includes farmers, teachers, war victims and civil society actors. The Economist wrote in July how Rajapaksa's slashed taxes leading to tax receipts plummeting by a quarter and the budget deficit rising. "Two-thirds. of government revenue now goes on interest payments", the Economist notes. This comes as investing agencies such as Bloomberg, Moody and Fitch have issued warnings on Sri Lanka which may cut the island "off from international capital markets". 

Read more here.

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