Skip to content 
Search

Latest Stories

Used cars turn to gold as Sri Lanka economy skids on the edge

Used cars turn to gold as Sri Lanka economy skids on the edge

Supermarket shelves are bare and restaurants can't serve meals, but Sri Lanka's economic crisis is a bonanza for used car dealers, with vehicle shortages pushing prices higher than a house in a nice area.

The island nation of 22 million is on the brink of bankruptcy, inflation is red hot and the government has barred a range of "non-essential" imports to save dollars needed to buy food, medicine and fuel.


In the car market, this two-year ban has kept factory-fresh automobiles off local roads, forcing desperate buyers to pay some of the world's highest prices for beaten-up compacts and no-frills family sedans.

Anthony Fernando spent a recent weekend coursing through sales lots in the Colombo outskirts on behalf of his daughter, who has tried to find an affordable set of wheels for nearly a year.

"She was thinking that prices will come down," the 63-year-old told AFP, but now she is "paying for procrastinating".

Prices have gone "beyond the reach of a common person", he said.

A five-year-old Toyota Land Cruiser was on offer online for an eye-watering 62.5 million rupees ($312,500) -- triple the pre-ban rate, and enough to buy a house in a middle-class Colombo neighbourhood or a new luxury apartment in the city centre.

A decade-old Fiat five-seater with a busted engine that might be stripped for parts elsewhere was listed at $8,250 -- more than twice Sri Lanka's average yearly income.

"A car and a house are symbols of success," said a grinning Sarath Yapa Bandara, the owner of one of the capital's biggest dealerships.

"That is why most people are willing to buy even at these high prices."

- 'Out of this world' -

Car ownership remains a virtual necessity in the traffic-snarled streets of Colombo, where a ramshackle bus and rail network was already struggling with overcrowding.

The number of taxis has also fallen sharply, with drivers selling their cabs to cash in on the dizzying prices, and those still working charging double their old fares or more.

"You must have your own car," said Udaya Hegoda Arachchi, another buyer preparing to bite the bullet at a dealership.

"We can't expect prices to come down anytime soon, given the economic situation in the country," he told AFP.

Covid has sent Sri Lanka into a tailspin, drying up all-important earnings from tourism and foreign remittances.

In March 2020 the government brought in a wide-ranging import ban -- including for new cars -- to stop foreign currency from leaving the country.

But the policy has not been able to staunch the outflow of dollars, and has instead left the nation struggling to source critical goods.

Food retailers have rationed rice, restaurants have shuttered because they cannot find cooking gas, and cash-strapped power utilities unable to afford oil have imposed rolling blackouts. Farmers have run out of fertiliser.

- Chinese debt -

Rating agencies have warned that Sri Lanka might default soon although the government says it will meet its commitments. It is trying to renegotiate its Chinese debts with Beijing.

The import ban has also left car parts in short supply, meaning drivers are at risk of being stranded after a breakdown.

Ravi Ekanayake told AFP that his Colombo repair garage was doing a roaring trade from owners unable to afford the astronomical costs of switching to a new vehicle.

"But parts are scarce. It is a catch-22: You either get caught with an old car without parts or you don't have the money to buy a new car."

Financial analyst Murtaza Jafferjee said the prices also underscored a problem caused by excessive money printing by a cash-strapped central bank, with "too much money chasing too few goods".

He said the prices were also increasing transport costs and adding to inflation, which hit a record 14 percent in December.

"When vehicles become unaffordable for a segment of society, their activities will be limited. Then we will also see a loss of economic output," the CEO of JB Securities said.

"We are about to collapse and not many people appreciate the depth of the problem."

More For You

uk weather

Amber heat health alerts have been issued across several regions of England

iStock

England faces widespread heat alerts and hosepipe bans amid rising temperatures

Highlights:

  • Amber heat health alerts in place for large parts of England
  • Hosepipe bans announced in Yorkshire, Kent and Sussex
  • Temperatures could reach 33°C over the weekend
  • Health risks rise, especially for elderly and vulnerable groups

Heat warnings in effect as UK braces for another hot weekend

Amber heat health alerts have been issued across several regions of England, with temperatures expected to climb to 33°C in some areas over the weekend. The UK Health Security Agency (UKHSA) activated the warning at 12 pm on Friday, with it set to remain in place until 9 am on Monday.

The alerts cover the East Midlands, West Midlands, south-east, south-west, East of England, and London. Additional yellow alerts were issued for the north-east, north-west, and Yorkshire and the Humber, starting from midday Friday.

Keep ReadingShow less
Essex ladybird invasion

One of the largest gatherings was filmed on a beach at Point Clear

Dee-anne Markiewicz / SWNS

Swarms of ladybirds invade Essex coastline amid soaring temperatures

Highlights:

  • Ladybird swarms reported across Essex and Suffolk coastal towns
  • Hot weather likely driving the sudden surge in population
  • Sightings include Point Clear, Shoebury, Clacton and Felixstowe
  • Similar outbreaks occurred in 1976 during another hot UK summer

Sudden surge in ladybird numbers across the southeast

Millions of ladybirds have been spotted swarming towns and villages along the Essex coast, with similar sightings stretching into Suffolk. Residents have reported unusually high numbers of the red and black-spotted insects, particularly near coastal areas, with the recent hot weather believed to be a major contributing factor.

One of the largest gatherings was filmed on a beach at Point Clear, a village near St Osyth in Essex, where the insects could be seen piling on top of each other on driftwood and plants.

Keep ReadingShow less
Kapil Sharma

Kapil Sharma’s Canada cafe shot at days after opening

Instagram/ginnichatrath

Kapil Sharma’s Canadian café targeted in shooting, Khalistani terrorist cites mockery of Nihang Sikhs as motive

Highlights:

  • Shots were fired at Kap’s Café in Surrey, Canada, owned by comedian Kapil Sharma, just days after its opening.
  • Khalistani extremist Harjit Singh Laddi, linked to banned group BKI, claimed responsibility.
  • The motive cited was an old comedy segment from The Kapil Sharma Show that allegedly mocked Nihang Sikhs.
  • No injuries were reported; Canadian authorities are investigating the incident.

Comedian Kapil Sharma’s recently launched Kap’s Café in Surrey, British Columbia, was the target of a shooting in the early hours of 10 July. Though no one was harmed, the property sustained significant damage. A known Khalistani extremist, Harjit Singh Laddi, has claimed responsibility for the attack, citing perceived religious disrespect on The Kapil Sharma Show.

 Kap\u2019s Cafe in Surrey  Kap’s Cafe in Surrey was struck by gunfire late at night with staff still insideInstagram/thekapscafe_

Keep ReadingShow less
Police probe hate crime over migrant effigies bonfire in Northern Ireland

Models depicting migrants wearing life jackets in a small boat alongside two banners reading 'Stop the boats' and 'Veterans before refugees' are displayed on top a bonfire in Moygashel, Northern Ireland, on July 9, 2025. (Photo by PETER MURPHY/AFP via Getty Images)

Police probe hate crime over migrant effigies bonfire in Northern Ireland

POLICE in Northern Ireland have launched a hate crime investigation after a bonfire topped with effigies of migrants in a boat was set alight in the village of Moygashel, County Tyrone.

The incident, which took place on Thursday (10) night, has drawn widespread condemnation from political leaders, church officials, and human rights groups.

Keep ReadingShow less
Navratri festival in Wembley

A similar event held at the same site last year resulted in a planning enforcement notice being issued due to complaints of noise and disturbance.

Getty Images

Navratri festival in Wembley faces objections

A PROPOSED 10-day Hindu festival in Wembley, north London, has drawn objections over concerns about noise and disruption in the area.

Asian Events Media (AEM) has applied to Brent Council to host the Navratri celebration at Alperton Studios from September 22 to October 1, according to The London Standard.

Keep ReadingShow less