A security officer on the alert at the busiest road in Colombo, Sri Lanka. Picture used for illustrative purposes only.
Sri Lanka's central bank hiked interest rates on Thursday in a bid to tame rampant inflation and discourage consumer spending as the country suffers a foreign currency shortage and teeters on the brink of default.
The island nation of around 22 million has seen shortages of food and fuel as well as electricity rationing, with rating agencies warning it might not be able to meet repayments on its debts. Inflation hit a record 12.1 percent last month.
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The island nation has reiterated its commitment to repaying the entire $4 billion owed to investors in the rest of 2022 but in the absence of incoming dollars some analysts believe the country could face its first-ever default.
People queue to buy Liquefied Petroleum Gas cylinders in Colombo on Wednesday. AFP
The Central Bank of Sri Lanka (CBSL) raised the standing deposit facility rate and the standing lending facility rate by 50 basis points (bps) each to 5.50% and 6.50%, respectively.
"Inflationary pressures on the domestic front continued to be fuelled by supply-side disruptions, upward adjustments to administered domestic prices," the bank said in a statement.
It said the economy grew 4.0 per cent last year, having suffered a record 3.6 per cent contraction in 2020.
Colombo insists it will honour it obligations on its $35 billon in external debt.
Twenty-six ministers in the cabinet — all members except President Gotabaya Rajapaksa and his elder brother Prime Minister Mahinda Rajapaksa — submitted letters of resignation at a late-night meeting on Sunday.
Facebook, YouTube, Twitter, Instagram and WhatsApp were among the platforms shut down by internet service providers on the orders of defence authorities, the pro-government Ada Derana news channel said.
Sri Lanka's parliament will meet on Tuesday after President Gotabaya Rajapaksa dissolved his cabinet and sought to form a unity government to find a way out of the island nation's worst economic crisis in decades and quell public anger.
The island nation of 22 million people has been hit by prolonged power cuts, with drugs, fuel and other items running short, bringing angry protesters out on the streets and putting President Gotabaya Rajapaksa under mounting pressure.
At least 288 people were killed and hundreds more injured in a three-train collision in India, officials said Saturday, the country's deadliest rail accident in more than 20 years.
The nation-wide campaign aims to spread awareness about the environmental sustainability issues, encourage local community engagement and support climate action-related strategies.
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“I extend my heartfelt condolences to all those affected by the train accident in India. The thoughts of everyone in the UAE are with Prime Minister @narendramodi and the people of India at this time,” tweeted Sheikh Mohamed Bin Zayed.