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September 1, 2021 at 5:36 pm #2531Timilehin Eburu
A labourer pulls a cart loaded with vegetables at the main market in Colombo on August 31, 2021 following Sri Lanka’s declaration of state of emergency over food shortages as private banks ran out of foreign exchange to finance imports.
Sri Lanka has seen a surge in the cost of basic foodstuffs such as sugar, onions and potatoes. Sri Lanka has declared an economic emergency, after a steep fall in the value of the South Asian country’s currency caused a spike in food prices. Authorities say they will take control of the supply of basic food items, including rice and sugar, and set prices in an attempt to control rising inflation.
The Sri Lankan rupee has fallen by 7.5% against the US dollar this year.
The wide-ranging emergency measures came into effect on Tuesday.
A former army general has been appointed by the government as the commissioner of essential services, with the power to seize stocks held by traders and retailers.
“The authorised officers will be able to take steps to provide essential food items at concessionary rate to the public by purchasing stocks of essential food items,” the president of the island nation, Gotabaya Rajapaksa, said in a statement.
“These items will be provided at government guaranteed prices or based on the customs value on imported goods to prevent market irregularities,” the statement added.
People stand in a queue to buy kerosene oil used in cooking stoves in Colombo on August 31, 2021 following Sri Lanka’s declaration of state of emergency over food shortages as private banks ran out of foreign exchange to finance imports.
There have been long queues for kerosene after the declaration of an economic emergency. The announcement came after a surge in the cost of basic foodstuffs such as sugar, onions and potatoes. There have also been long queues outside shops due to shortages of other goods including milk powder, kerosene and cooking gas.
The Country’s Department of Census and Statistics said the increase in the foreign exchange rate was one of the reasons behind rising prices of many essential items over the last year.
Month-on-month inflation rose to 6% in August, mainly due to high food prices, the department said.
The country, which is a net importer of food and other commodities, is witnessing a surge in coronavirus cases and deaths which has hit tourism, one of the country’s main foreign currency earners.
Partly as a result of the slump in tourist numbers, Sri Lanka’s economy shrank by a record 3.6% last year.
In March last year, the government imposed an import ban on vehicles and other items as it tried to stem the outflow of foreign currencies.
Earlier this month, Sri Lanka became the first country in the region to raise interest rates in an attempt to shore up its currency and help ease the inflationary pressure of the high cost of imports.
Sri Lanka is currently under a 16-day curfew until Monday because of a jump in Covid-19 cases.
Source: BBC News
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