President sees long road to securing economic stability

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President Ranil Wickremesinghe said the country has experienced the worst of its economic crisis and that restoring political stability will allow it to begin turning a corner, starting with finalizing negotiations for an International Monetary Fund bailout that had stalled due to recent turmoil.

“I think we’ve already hit the bottom,” Wickremesinghe said in an interview on Sunday with The Wall Street Journal. “I can see the light at the end of the tunnel; it’s how fast we can get to it.”

He also acknowledged that it will take months before most Sri Lankans, who have faced runaway inflation and long queues for fuel and cooking gas, will begin to see their economic circumstances improve markedly.

Speaking from his office in the Presidential Secretariat, which Wickremesinghe only moved into on Wednesday after it had been occupied earlier in July by protesters, the President said he expected the IMF staff-level agreement to be reached by the end of August, after which the country would be able to further talks with sovereign bondholders and bilateral creditors. Any preliminary agreement would still require IMF board approval for the disbursement of funds, a process that could take months.

“We are down to the nitty-gritty,” he said. “We would have had it this month [July] if it were not for the unstable political condition.”

Wickremesinghe also said it wasn’t the right time for former president Gotabaya Rajapaksa to return to Sri Lanka, saying it could inflame political tensions among tens of thousands of protesters who rallied to oust him over his management of the economy. Rajapaksa left the country on a military aircraft bound for Maldives on 13 July, before traveling onward to Singapore where he resigned over email.

Cabinet spokesman Bandula Gunawardena said on Tuesday that Rajapaksa wasn’t in hiding and was expected to return. But Wickremesinghe, who said he remained in contact with the former Head of State to deal with administrative handover issues and other government business, said Rajapaksa hadn’t told him he planned to return to Sri Lanka soon.

“I don’t believe it’s the time for him to return,” he said. “I have no indication of him returning soon.”

Source: The Wall Street Journal