Skip to content 
Search

Latest Stories

Crisis-hit Sri Lanka needs $5bn, help from China for essentials

The island nation’s worst economic crisis in seven decades led to a shortage of foreign exchange.

Crisis-hit Sri Lanka needs $5bn, help from China for essentials

SRI LANKA will need $5 billion over the next six months to ensure basic living standards, and is renegotiating the terms of a yuan-denominated swap worth $1.5bn with China so as to fund essential imports, the prime minister said on Tuesday (7).

The island nation's worst economic crisis in seven decades led to a shortage of foreign exchange that stalled imports of essential items such as fuel, medicine and fertiliser, provoking devaluation, street protests and a change of government.


To tide over the turmoil, Sri Lanka will need about $3.3bn for fuel imports, $900m for food, $250m for cooking gas and $600m more for fertiliser this year, prime minister Ranil Wickremesinghe told parliament.

The central bank has estimated the economy will contract by 3.5 per cent in 2022, Wickremesinghe said, but added that he was confident growth could return with a strong reform package, debt restructuring and international support.

"Only establishing economic stability is not enough, we have to restructure the entire economy," said Wickremesinghe, who is working on an interim budget to balance battered public finances.

"We need to achieve economic stability by the end of 2023."

The Indian Ocean nation of 22 million is negotiating a loan package worth about $3bn from the International Monetary Fund, in addition to help from countries such as China, India and Japan.

On Tuesday (7), the cabinet approved a $55m credit line from India's Exim Bank to fund 150,000 tonnes of urea imports - a critical requirement as supplies have run out during the current cropping season.

"Farmers do not need to be worried about not having inputs for the next season," cabinet spokesman Bandula Gunawardena told reporters, estimating that 150,000 tonnes of urea would be needed for the next cultivation cycle.

While food inflation of 57 per cent is partly driven by higher global commodity prices, a depreciated currency and low domestic production, it is estimated that yields from the next harvest will be halved by the lack of fertiliser.

The UN is set to make a worldwide public appeal for Sri Lanka on Wednesday (8), and has pledged $48m for food, agriculture and health, Wickremesinghe said.

Sri Lanka was also renegotiating with China the terms of a yuan-denominated swap worth $1.5bn agreed last year.

The initial terms provided that the swap could only be used if Sri Lanka maintained reserves equivalent to three months of imports.

But with reserves now well below that level, Sri Lanka has to request China to reconsider the requirement and allow the swap to proceed, Wickremesinghe said.

Wickremesinghe, who is also finance minister, will unveil an interim budget next month that he said aims to slash government expenses and looks to increase annual welfare spending to $500m from about $350m.

(Reuters)

More For You

Modi set for UK visit to sign free trade agreement

FILE PHOTO: Keir Starmer (L) with Narendra Modi. (Photo: Getty Images)

Modi set for UK visit to sign free trade agreement

INDIA's prime minister Narendra Modi is likely to travel to the UK by the end of this month for a visit that could see both sides formally sign the landmark India-UK free trade agreement and explore ways to expand bilateral ties in the defence and security sphere, diplomatic sources said.

Both sides are in the process of finalising the dates for Modi's visit to the country by the end of July or the first part of August, they said.

Keep ReadingShow less
Rishi Sunak returns to Goldman Sachs, will donate salary to charity

Rishi Sunak. (Photo by Carl Court/Getty Images)

Rishi Sunak returns to Goldman Sachs, will donate salary to charity

FORMER prime minister Rishi Sunak has returned to the banking world as senior adviser at Goldman Sachs group, with plans to donate his salary to the education charity he recently established with his wife Akshata Murty.

The US-headquartered multinational investment bank, where Sunak worked before entering politics, made the announcement on Tuesday (8) after the requisite 12-month period elapsed since the British Indian leader's ministerial term concluded following defeat in the general election on July 4 last year.

Keep ReadingShow less
 Post Office Horizon

A Post Office van parked outside the venue for the Post Office Horizon IT inquiry at Aldwych House on January 11, 2024 in London.

Getty Images

Post Office scandal linked to 13 suicides, says inquiry

Highlights:

 
     
  • Public inquiry finds up to 13 suicides linked to wrongful Post Office prosecutions.
  •  
  • Horizon IT system faults led to false accusations, financial ruin, and imprisonment.
  •  
  • Sir Wyn Williams says Post Office maintained a “fiction” of accurate data despite known faults.

A PUBLIC inquiry has found that up to 13 people may have taken their own lives after being wrongly accused of financial misconduct by the Post Office, in what is now described as one of the worst miscarriages of justice in British history.

Keep ReadingShow less
UK ramps up drought response following driest spring

The EA has begun conducting more compliance checks on high-usage industries

Getty Images

UK ramps up drought response following driest spring since 1893

Key points

  • Spring 2025 was England’s driest and warmest in over 130 years
  • Reservoirs across England only 77% full, compared to 93% average
  • Environment Agency increases monitoring and drought planning
  • North-west England officially declared in drought

Water conservation measures stepped up ahead of summer

The UK government has increased efforts to manage water resources after confirming that England experienced its driest and warmest spring since 1893. The Environment Agency (EA) reported that reservoirs were on average only 77% full, significantly lower than the usual 93% for this time of year.

The announcement came after a National Drought Group meeting on Thursday, which reviewed the impact of continued dry weather on crops, canal navigation, and river flows. Poor grass growth and dry soil conditions were noted as threats to food production and livestock feed.

Keep ReadingShow less
Norman Tebbit

Following Thatcher’s third general election victory in 1987, Tebbit stepped back from frontline politics to care for his wife. (Photo: Getty Images)

Getty Images

Former minister, Thatcher ally Norman Tebbit dies at 94

Norman Tebbit, a close ally of former British prime minister Margaret Thatcher and a former Conservative Party cabinet minister, has died at the age of 94. His son William confirmed the news on Tuesday.

"At 11:15 pm on 7th July, 2025, Lord Tebbit died peacefully at home aged 94," William Tebbit said in a statement.

Keep ReadingShow less