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Sri Lanka: Ministry of Finance Out of Funds

Sri Lanka ‘s finance ministry isexperiencing a shortage of funds at a time when a serious economic crisis continues to haunt the South Asian island nation, said a Sri Lankan cabinet spokesman as reported by Xinhua on Wednesday, January 11, 2023 .

Sri Lanka Cabinet spokesperson Bandula Gunawardena told reporters that funds raised through taxes had decreased.

As a result, the country’s finance ministry is short on funds to make payments, said Gunawardena.

According to Gunawardena, the economic crisis that hit the country in 2022 has had an impact on state revenues.

Hundreds of Sri Lankans stood in long queues to get their basic necessities. Sri Lanka’s finance ministry is strapped for funds at a time of serious economic crisis that continues to haunt the South Asian island nation.

“Estimated tax revenue for the first three months of 2023 is low. However, we need to pay public sector salaries. Payments are made by the state finance ministry and not from our private funds,” he said

He revealed that the president had instructed all ministries to slash their budget allocations for 2023 by at least 5 percent.

Gunawardena said that further steps to reduce spending would be taken to lessen the impact caused by the economic crisis.

The cabinet spokesman explained that the country’s finance ministry gets funds from public taxes. The country had previously been able to print money and get loans, but now this could not be done, because no one was willing to lend and the country could not print money.

Sri Lanka defaulted on loans last year and is currently seeking approval from the International Monetary Fund (IMF) for a bailout package to help the country recover from the crisis.

Source: Dunia