Why SRI LANKA is Facing the Biggest Economic Crises since it’s Independence.
Despite having the highest or one of the highest HDI,GINI,and per capita income among South Asian nations, SRI LANKA is Facing the Biggest Economic Crises in the Country.
A mixture of failed government policies, faulty planning and the pandemic has brought the financial system of the nation to collapse.
The Sri Lankan economy has been facing one of its worst ever economic crisis, resulting from mismanaged government finances and ill-timed tax cuts, besides the impact of the Covid-19 pandemic.
Huge piles of foreign debt, series of lockdowns, soaring inflation, shortage in fuel supply, fall in foreign currency reserves and devaluation of currency has adversely impacted the country’s economic growth.
Sri Lanka’s economy grew at a slower-than-expected 1.8 per cent in the fourth quarter of the 2021 financial year, taking its full year growth to 3.7 per cent, data from the government’s statistics department showed.
The Sri Lankan central bank had projected a growth of 5 per cent for the year.
Countries like India, China and Bangladesh have stepped in to help Sri Lanka weather this crisis. It has also sought financial assistance from International Monetary Fund (IMF).