Sri Lanka’s Criminal Investigation Department (CID) has arrested the Chief Secretary of the Jathika Sevaka Sangamaya of the Ceylon Petroleum Corporation, Ananda Palitha, after he issued a warning over the country’s fuel shortage.
The statement follows denials by the Sri Lankan Energy Minister that the country faced a fuel crisis despite only holding 11 days stock worth of diesel and 10 days worth of petrol. In response, Sri Lankans have turned to panic buying resulting in long queues at fuelling stations seen in major cities such as Colombo.
This announcement was followed by a plea to Sri Lanka’s citizens to not do “anything to Sri Lanka’s economy”, from Sri Lanka’s Trade Minister, Bandula Gunawardena. Gunawardene warned that without foreign currency the country wouldn’t be able to open LCs to import fuel.
I worship & implore of all citizens, please don't do anything to #SriLanka's economy. If we don't have foreign currency, we won't be able to open LCs to import #Fuel - Bandula Gunawardena Trade Min.#COVID19 #Colombo #SLnews pic.twitter.com/CRd57stF7g
— Newshub.lk (@Newshub_lk) August 21, 2021
The concern over foreign currency echoes the Energy Minister’s claim that the country faced a “foreign currency crisis”. Gammanpila explained that the government has been unable to hold large buffer stocks of fuel as the Ceylon Petroleum Corporation was unable to source the dollars needed to finance it.
The government has responded to this crisis by printing money to keep rates down and to fund state workers however this has led to issues of inflation and rises in food prices. In the past month, consumer price-based inflation rose 5.7% compared with June's 5.2%. At the same time, the country’s currency has depreciated 8% this year.
On Thursday the government increased the rate at which overnight money was printed from 5.50 % to 6%.
Read more here.