The government in crisis-stricken Sri Lanka has said it will print more money and cut spending on infrastructure as part of an attempt to pacify the restive population. The government, however, concedes that printing more money will likely see the inflation rate rise to 40%.
Looking at the hard days ahead, there have to be protests. It’s natural when people suffer, they must protest. But we want to ensure that it does not destabilise the political system. With the interim budget, it is just about cutting down expenditure, cutting to the bone where possible and transferring it to welfare.
According to the Business Standard report, Sri Lanka’s economic woes were triggered by the Covid-19 pandemic, which ruined the country’s tourism industry. Some critics have, however, placed the blame on President Gotabaya Rajapaksa’s government, which approved tax cuts they argue caused the income flowing into government coffers to drop further.