WB to provide USD 300 to 600M

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The World Bank is expected to provide Sri Lanka with USD 300 to USD 600 million over the next four month for the purchase of medicine and other essential items, as the country faces difficulties in making payments due to the foreign exchange crisis.

Sri Lanka has been facing difficulties in purchasing essential goods as it has no way of making on time payments to goods providers which has led to massive queues and island-wide protests.

According to Finance Minister Ali Sabri, who is in Washington to negotiate a rescue package with the International Monetary Fund, the World Bank will provide some funding to ease pressure on purchasing medicine and essential goods.

According to Sabri, India has agreed to provide a further USD 500 million to purchase fuel and the Government was in discussion seeking an additional USD one billion from its neighbour.

According to senior economists, Sri Lanka is on the brink of bankruptcy as the country had a USD 7 billion loan repayment this year.

The Government recently suspended servicing its debt and said it would restructure all its borrowings to be eligible for the IMF programme.

Due to the shortages of essential goods, today Sri Lankans are lining up in front of fuel stations, cooking gas dealers and other stores to buy from the limited stocks available.

Sri Lanka saw its inflation peak to 21.8 per cent last month, which is the highest rate the country has witnessed in recent history and products are moving away from citizens’ purchasing power.

By Mario Andree