• Warns oil price hikes and Middle East instability could threaten recovery

Opposition and SJB Leader Sajith Premadasa said the Government should move towards a successor agreement with the International Monetary Fund (IMF), warning that the country could once again face economic collapse if global oil prices rise and external shocks worsen.

He made the remarks during a preliminary discussion held at the SJB headquarters yesterday (24) to establish the party’s teachers’ union.

He said that although President Anura Kumara Dissanayake was attempting to project that the country no longer faced economic difficulties and had sufficient foreign exchange reserves, various economic indicators reflected the risks currently facing the country.

He said the public should have a realistic understanding of the prevailing situation.

The Opposition Leader further said that according to internationally accepted standards, a country’s foreign exchange reserves should be sufficient to cover at least three months of imports. However, he claimed that Sri Lanka had still failed to meet that benchmark.

He noted that the country’s monthly import bill stood at around United States Dollar (US$) 2 billion and claimed that the existing reserves were insufficient to cover three months of import expenditure.

Premadasa also warned that although foreign remittances had increased to around US$ 8 billion, a prolonged escalation of conflict in the Middle East could severely affect Sri Lanka’s economy.

He said a collapse in Middle Eastern economies could result in Sri Lankan migrant workers losing their jobs, adding that the Government was failing to openly discuss the potential impact of such a situation.