Senior US officials visit Sri Lanka to help resolve the crisis

by Kerry G. Alvarez

COLOMBO, Sri Lanka — Senior US officials arrived in Sri Lanka on Sunday to find ways to help the island gripped by an unprecedented economic crisis and severe shortages of essential supplies, as the energy secretary warned that new fuel deliveries would be delayed.

In the past two weeks, the US has announced millions of dollars in aid to Sri Lanka, which survived on $4 billion in credit lines from neighboring India. It has also received pledges of $300 million to $600 million from the World Bank to purchase medicines and other items.

Prime Minister Ranil Wickremesinghe announced last week that the economy had “collapsed” due to declining foreign exchange reserves and mounting debt, exacerbated by the pandemic and other longer-term problems.

Senior US officials visit Sri Lanka to help resolve the crisis

The US delegation was led by Robert Kaproth, Deputy Assistant Secretary of the Treasury for Asia, and Kelly Keiderling, Deputy Assistant Secretary of State for South and Central Asia.

During their four-day vacation, they will meet with a wide range of political representatives, economists, and international organizations to “explore the most effective ways the US can support Sri Lankans in need, Sri Lankans working to resolve the current economic crisis, and Sri Lankans plan for a sustainable and inclusive economy for the future,” the US embassy said in a statement.

“This visit underlines our continued commitment to the security and prosperity of the Sri Lankan people,” said Julie Chung, US Ambassador to Sri Lanka.

She said that while Sri Lankans endure some of the “greatest economic challenges in their history, our efforts to support economic growth and strengthen democratic institutions have never been more critical.”

The US has announced that it will provide $120 million in new financing for small and medium-sized businesses, a $27 million contribution to Sri Lanka’s dairy industry, and $5.75 million in humanitarian aid to those hardest hit by the economic crisis. Another $6 million was committed to new living grants and technical assistance for financial reform. To assist.

Sri Lanka says it cannot repay $7 billion in foreign debt owed this year, pending the outcome of negotiations with the International Monetary Fund on a bailout package. It must pay an average of $5 billion annually until 2026. Authorities have asked the IMF to conduct a conference to unite Sri Lanka’s lenders.

On Saturday evening, energy and Power Minister Kanchana Wijesekera urged not to queue for fuel, saying new shipments would be delayed due to “banking and logistical reasons”.

He said limited fuel supplies would be distributed to fixed stations in the coming week. He said that until the next shipments arrive, “public transport, power generation, and industries will be prioritized.”

Wickremesinghe said last week that the state-run Ceylon Petroleum Corporation had $700 million in debt, and as a result, no country or organization was willing to provide fuel.

Protesters have occupied the entrance to President Gotabaya Rajapaksa’s office for more than two months and demanded his resignation, alleging primary responsibility for the crisis lies with him and his family, whom they accuse of corruption and mismanagement.

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