SRI LANKA cut power prices by 22.5 per cent from Tuesday (16), the utilities regulator said, as the country attempts to ease the cost of living for millions of people amid its worst financial crisis in decades.
After the crisis shrank its economy by 7.8 per cent in 2022, Sri Lanka boosted power prices by 75 per cent that September and then by 66 per cent in February to meet the terms of a $2.9-billion (£2.2bn) bailout from the Intenional Monetary Fund (IMF).
Industries would also see a cut of about 33 per cent in power tariffs, the regulator added, with poorer users getting a reduction of about 2,000 rupees (£5.4) in their bills.
“We expect this reduction to assist in the rejuvenation of the economy and help the public get relief,” Manjula Fernando, chairman of the Public Utilities Commission of Sri Lanka (PUCSL), said on Monday (15).
The cut will help Sri Lanka stick to an inflation target of five per cent set by its central bank, analysts said, in an economy expected to grow by three per cent this year after a gap of two years.
Together with higher taxes, a weaker rupee, and fuel cost increases, the power price hikes had pushed inflation in the nation of 22 million people to a record high of 70 per cent in September 2022.
But it declined sharply to 1.7 per cent in June, helped by a price cut of 21.9 per cent in March this year.
