Sri Lanka’s fragile economic recovery could be hampered by threatened trade union strikes over reduced benefits for government employees in this year’s budget, the IMF said yesterday.
Sri Lankan President Anura Kumara Dissanayake’s maiden budget raised public sector salaries, but also made deep cuts to longstanding perks in a continuing effort to repair the island nation’s tattered finances.
Sri Lanka’s main doctors’ union is considering a strike from today to protest against cuts to their allowances, while teachers are also considering stoppages.
Photo: EPA-EFE
IMF senior mission chief for Sri Lanka Peter Breuer said the budget was the “last big push” for the country’s austerity program, adding that everyone who can “should make a sacrifice.”
“Sticking with the reforms is really the best way out for Sri Lanka to assure its sustainability,” Breuer told reporters.
“I think it’s important for everyone in Sri Lanka to recognize that,” he said. “This is the last budget where there is still a bit of an increase in revenues needed.”
In 2022, the country endured an unprecedented economic crisis that caused widespread shortages of food, fuel and other essentials. It secured a US$2.9 billion bailout loan from the IMF in 2023, almost a year after defaulting on US$46 billion in foreign debt.
Successive governments have since raised taxes and cut public spending to increase state revenue.
The next year would be less painful, but the country must remain committed to economic reforms, Breuer said.
“This is the last big push,” he said. “Thereafter, it will be much easier going forward.”
The IMF last week released its fourth tranche of US$334 million in its rescue package for Sri Lanka, commending the country for adhering to its economic reform pledges.
“Reforms in Sri Lanka are bearing fruit and the economic recovery has been remarkable,” IMF deputy managing director Kenji Okamura said in a statement at the time.
“Inflation remains low, revenue collection is improving, and reserves continue to accumulate,” he said. “The recovery is expected to continue in 2025.”
SPEAKING OUT: After Siranudh Scott’s allegations surfaced, celebrities and public figures took to social media to share their own experiences of sexual misconduct and abuse A high-profile alleged sexual abuse case within a wealthy Thai beer brewing family has prompted a wave of painful accounts from survivors of unconnected abuse in the conservative nation. Siranudh Scott, a member of the billionaire Thai family that founded the ubiquitous Singha beer brand, posted an emotional video this month accusing his elder brother Sunit of repeatedly abusing him when he was a teenager. Sunit, who is in his 30s, later denied the allegations in a video posted online, but Singha parent Boonrawd dismissed him from his executive role with the company on Tuesday last week. “I felt I needed to speak
SEEKING ORDER: Rodrigo Paz said that ‘anyone who wants to destroy the nation will have to deal with this president and the full force of the constitution’ Bolivian President Rodrigo Paz on Wednesday said that the nation was at a “breaking point” after nearly a month of protests that have caused shortages of food, fuel and medicine. Paz, who took office six months ago amid the worst economic crisis there in four decades, is battling a groundswell of fury over his policies. The political capital, La Paz, has been besieged by low-income workers and members of the indigenous majority calling for his resignation. “The country needs order and is reaching breaking point,” the 58-year-old said at a public event in La Paz, renewing his appeal for dialogue. On Tuesday, the Bolivian
COMMUNITY CONFLICT: Concerns about disease spread from corpses has run up against friends and families’ desire to bury their dead as infection spreads in the area Angry residents of a town at the epicenter of the Ebola outbreak in the Democratic Republic of the Congo (DR Congo) attacked and burned a tent that was part of a health center where people are being treated for the virus, the staff there said Saturday. It was the second such attack in the region in a week. No one was hurt in the attack, according to reports but as patients ran out to escape the fire, 18 people with suspected Ebola infections fled the facility and are unaccounted for, a hospital director said. Angry residents arrived at the clinic in the
Forecasters in Europe yesterday warned of exceptional heat as record temperatures driven by a “heat dome” push temperatures well above seasonal norms across the continent. The surge follows a record-breaking Monday, with France logging its hottest day in the month of May on record, its weather agency said, and the UK also posting unprecedented highs. A so-called “heat dome” of warm air from northern Africa trapped under a high-pressure system over western Europe is behind the high temperatures not usually seen until high summer. Restrictions on outdoor work were imposed in parts of Italy, beaches in southwest France filled earlier than usual and
RSS