Sri Lanka's Economy Grinds to a Halt as Fuel Supplies Run Dry




  • In Business
  • 2022-06-17 04:31:49Z
  • By Bloomberg
 

(Bloomberg) -- Sri Lanka's economic activity is coming to a near standstill as the island nation, facing its worst financial crisis, runs out of fuel for transport and there's little signs of fresh supplies coming in.

Most Read from Bloomberg

  • China Says It May Have Detected Signals From Alien Civilizations

  • Stocks Jump as Powell Soothes Wall Street's Nerves: Markets Wrap

  • Fed Hikes 75 Basis Points; Powell Says 75 or 50 Likely in July

  • World's Central Banks Got It Wrong, and Economies Pay the Price

  • Americans Are Building Vacation-Home Empires With Easy-Money Loans

The government declared Friday a holiday for public offices and schools to curtail vehicular movement, leaving many roads in and around the capital Colombo deserted. Meanwhile, thousands of vehicles are lined up in queues stretching for kilometers as drivers wait for filling stations to be replenished.

The Minister of Power and Energy Kanchana Wijesekera said on Thursday that the state-run Ceylon Petroleum Corp hadn't received tenders for fresh stocks of fuel because suppliers were deterred by outstanding payments.

The South Asian nation has reached out to several companies and countries, including Russia, for supplies and was hoping for the approval from India for a fresh $500 million credit line for fuel imports, Wijesekera said.

Sri Lanka's economic meltdown, the most dire in its independent history, has seen protests erupt across the island for the past few months seeking the ouster of President Gotabaya Rajapaksa and his family members from government. The clan has been blamed for taking decisions that have led to severe shortages of everything from fuel to medicine, inflation at nearly 40%, daily power outages of as long as 13 hours and a historic debt default.

The nation will need about $6 billion in aid from the International Monetary Fund and countries including India and China, to tide over the next six months, according to Prime Minister Ranil Wickremesinghe. Local authorities are looking to fast-track bailout talks with the IMF in order to get other fresh sources of funding.

Sri Lanka's economy likely contracted in the first quarter, slammed by the public protests, political instability, high commodity prices and supply-chain snarls. According to Bloomberg Economics, a recession this year will be unavoidable.

Most Read from Bloomberg Businessweek

  • Sheryl Sandberg's Wedding Expenses Are the Least of Facebook's Sheryl Sandberg Problems

  • Janet Yellen Is Struggling at the Treasury Job She Never Wanted

  • A Ragtag Band of Hackers Is Waging Cyberwar on Putin's Supply Lines

  • A Billion-Dollar Crypto Gaming Startup Promised Riches and Delivered Disaster

  • The Fed Tried to Protect Main Street. Now It May Have to Make Everyone Suffer

©2022 Bloomberg L.P.

COMMENTS

More Related News

Hong Kong
Hong Kong's Dry Spell for IPOs Set to End With Big China Deals

(Bloomberg) -- After a dismal first six months, things are finally looking up for initial public offerings in Hong Kong as several large Chinese firms line...

Argentina Economy Minister Guzman Resigns as Divisions Grow
Argentina Economy Minister Guzman Resigns as Divisions Grow

(Bloomberg) -- Argentine Economy Minister Martin Guzman resigned Saturday, marking the biggest departure of President Alberto Fernandez's government after...

US Jobs Report Seen Showing Resilient Labor Demand: Eco Week
US Jobs Report Seen Showing Resilient Labor Demand: Eco Week

(Bloomberg) -- Sign up for the New Economy Daily newsletter, follow us @economics and subscribe to our podcast.Most Read from BloombergJPMorgan Sees...

Bond Holders Look to Recession for Salvation After Vicious Half
Bond Holders Look to Recession for Salvation After Vicious Half

(Bloomberg) -- Treasury holders reeling from the most brutal first half on record are starting to bet that a worsening economy will deliver some relief from ...

Germany Risks a Cascade of Utility Failures, Economy Chief Says
Germany Risks a Cascade of Utility Failures, Economy Chief Says

(Bloomberg) -- Germany should prepare for deeper cuts in Russian gas supplies because President Vladimir Putin is pursuing a conscious strategy of driving up...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

  • facebook解封
    (2022-06-29 03:38:58Z)

    事实上,facebook账户被屏蔽是正常的。特别是在美国大选的初期,该组织发布了许多信息,都在抱怨账户被屏蔽。如果您的个人数据是真实的,并且没有严重违反社区规定,那么解封并不困难

    REPLY
  • facebook解封
    (2022-06-29 06:15:42Z)

    事实上,facebook账户被屏蔽是正常的。特别是在美国大选的初期,该组织发布了许多信息,都在抱怨账户被屏蔽。如果您的个人数据是真实的,并且没有严重违反社区规定,那么解封并不困难

    REPLY

Top News: Business