Page 2 - Economic Crisis

Sri Lanka govt, Oppn trade barbs over failure to reach bondholder agreement

Sri Lanka continues to engage all debt restructuring negotiations in good faith, within principles of equitable treatment among creditors with maximum transparency, the government has said as it faced criticism from the Opposition for maintaining secrecy over the debt restructuring process. The government on Tuesday announced that it failed to reach an agreement with its international bondholders for restructuring around USD 12 billion in debt. The main opposition's economy spokesman Harsha de Silva in a statement said they were disappointed with the lack of transparency in the debt restructuring process. .It is obvious that that government has failed to strike a deal favourable to the people of Sri Lanka, de Silva of Samagi Jana Balawegaya party added. It is clear that the participating bondholders do not want to move away from the original structure they proposed based on the performance of the Sri Lanka economy to be measured on their much higher alternative baseline as opposed

Who will be new finance minister to be the first challenge in Pakistan

Pakistan's political impasse may end with the formation of a coalition government but its economic worries may linger on primarily due to the dilemma of the Pakistan Muslim League-Nawaz party over the appointment of the finance minister of the cash-strapped country. In January, the cash-strapped country received over USD 700 million second tranche from the Washington-based global lender under the existing USD 3 billion SBA agreed towards June last year when Pakistan was slowly drifting towards default. Earlier this week, US-based Fitch Ratings one of three leading global rating agencies said in its report that a new International Monetary Fund (IMF) deal to succeed the Stand-By Arrangement (SBA), expiring in March this year, was key to Pakistan's credit profile. Pakistan has not completed the last USD 6.5 billion IMF bailout package, and therefore, the first task of the new finance minister will be to sit with the Washington-based global lender to get the last loan tranche of USD

Uncertain political situation in Pakistan poses threat to IMF deal: Fitch

Fitch further noted country's vulnerable external position meant that securing financing from multilateral and bilateral partners would an urgent issues on the agenda for the next govt

China asks Pakistan's political parties to work together to form govt

Beijing is also bankrolling Pakistan, which is in the throes of an economic crisis, to maintain the balance of payments with periodic loans to maintain the requisite forex reserves

President Wickremesinghe paints positive growth in cash-strapped Sri Lanka

Projecting a positive shift in the cash-strapped Sri Lankan economy, President Ranil Wickremesinghe on Wednesday said despite negative growth through the earlier year, the nation rebounded with a 1.6 per cent growth rate in the Q3 of 2023 and also achieved a surplus by end 2023, first since 1977. President Wickremesinghe was delivering the Statement of Government Policy' on the first day of the Fifth Session of the Ninth Parliament here. Despite a 7.8 per cent GDP contraction and six consecutive quarters of negative growth in 2022, the nation rebounded with a 1.6 per cent growth rate in the Q3 of 2023, he said. Wickremesinghe further announced a significant turnaround in the nation's economic landscape. Despite the 1.9 per cent GDP deficit in 2022, the island nation has achieved a surplus by the end of 2023, marking the first such occurrence since 1977, Ada Derana website said, quoting the President as he delivered his speech streamed live. He started his address by announcing that

Economic pessimism hits record in Pakistan ahead of election on Feb 8

Some 70 per cent of Pakistanis said the economic situation around them is getting worse, the highest level in the 18 years that Gallup has been polling them

Bhutan's People's Democratic Party wins election, returns to power

The People's Democratic Party won the most seats in Bhutan's parliamentary elections on Tuesday and will form the new government as residents hope politicians make good on promises to fix the economic crisis in the Himalayan nation. Latest figures from the Bhutan Broadcasting Service, a national broadcaster, showed the PDP had won 30 of the 47 National Assembly seats to return to power, and the Bhutan Tendrel Party had secured 17. It was the country's fourth general elections since its transformation from a traditional monarchy to a parliamentary form of government in 2008. The Election Commission of Bhutan will make its final declaration on Wednesday. Candidates on Tuesday's ballot represented only the PDP of former Prime Minister Tshering Tobgay and the BTP led by former civil servant Pema Chewang. A primary round of voting in November eliminated three other parties, including the ruling center-left Druk Nyamrup Tshogpa party. Bhutan is located between China and India, with both

Pak may get $700 mn from IMF as next tranche of bailout this month: Report

Cash-strapped Pakistan is expected to get USD 700 million as the next tranche of the bailout from the IMF as the Executive Board of the global lender meets on January 11, according to a media report on Tuesday. The board of the Washington-based International Monetary Fund is set to deliberate and potentially grant final approval for the disbursement of the next USD 700 million tranche for Pakistan under the existing USD 3 billion Stand-By Arrangement (SBA), the Dawn newspaper reported. According to the IMF Executive Board calendar, upcoming meetings are scheduled for January 8, 10 and 11, with Pakistan's case slated for discussion on the last day. The current IMF programme, amounting to USD 3 billion, is expected to conclude in the second week of April, with approximately USD 1.8 billion remaining undisbursed. The initial tranche of USD 1.2 billion was released in July. In November 2023, a Staff-Level Agreement was reached between the IMF staff and Pakistani authorities regarding

There is no money: Argentina begins shock remedy to jolt stagnant economy

Total spending cuts will amount to 2.9% of gross domestic product, a senior government official said later. The goal is to eliminate the primary budget deficit

Instability disrupted economic growth; structural reforms needed: Pak FM

Pakistan's caretaker Finance Minister Shamshad Akhtar has said that political instability over the period of time has greatly disrupted the cash-strapped country's economic growth, which has to be backed by structural reforms. Addressing the Sustainable Development Conference (SDC) here on Thursday, the minister said macroeconomic stability has become more difficult in the last decade because of delays in structural reforms, protracted actions and exogenous shocks. The vulnerability of the economy has increased due to global economic shocks such as the increase in international commodity prices and tighter liquidity conditions, with Pakistan effectively priced out of the international credit markets, the Business Recorder newspaper quoted Akhtar as saying. "Vulnerability has increased due to the unsustainable debt position... Large fiscal and trade deficits over two decades have weakened the debt position, with the cost of servicing debt rising to 74 per cent of the FBR revenue in .

Centre trying to create economic crisis in Kerala; Cong a spectator: CM

Kerala Chief Minister Pinarayi Vijayan on Sunday accused the BJP-ruled Centre of trying to destroy the federal structure and creating an economic crisis in the southern state through its various policies and blamed the Congress-led UDF of being a silent spectator to the same. Alleging neglect and discrimination on the part of the Central government towards Kerala, Vijayan said it was getting this treatment despite achieving unprecedented gains in tax collection, domestic production and infrastructure development. Speaking during the Nava Kerala Sadas at the Uduma constituency here in the evening, the CM said that the Union government through its various policies was "financially strangulating the Left government" since it came into power back in 2016. "At the same time, the Congress and the UDF opposition led by it were being a mute spectator to this discrimination. Why this hesitancy in speaking out against the actions of the Centre which are against the state and its people?" he .

Sri Lankan SC finds Rajapaksa brothers responsible for economic crisis

The ruling was delivered based on the majority view of the five-judge bench presided over by Chief Justice Jayantha Jayasuriya

Sri Lankan President presents budget, says economy not out of crisis yet

Sri Lankan President Ranil Wickremesinghe on Monday presented his government's 2024 budget, emphasising the need for tough reforms until the full recovery of the cash-strapped island nation's economy. Although Sri Lanka has managed to control its hyperinflation in the ongoing economic crisis, its economy is far from being fully recovered. We have been able to put back on the rails the derailed economy. Still, people undergo suffering," Wickremesinghe, who is also the Finance Minister, said. The inflation which was 70 per cent in September 2022 has been reduced to 1.5 per cent in October this year," the minister said. He said in order for the island nation to prevent another bankruptcy, hard reforms are a must. The state banks were made to fund the losses of state enterprises. He proposed that two state banks' shares be issued to the public and investors while the government would inject cash into the state banks to maintain their stability. Wickremesinghe said the cost of living

India's growing 'Modi-made' economic crisis spiralling out of control: Cong

The Congress on Thursday attacked Prime Minister Narendra Modi over the unemployment rate reportedly climbing to a more than two-year high, claiming his enduring legacy as PM is record unemployment. The party also said that India's growing "economic crisis" continues to spiral out of control. Congress general secretaty Jairam Ramesh's attack at the government came after a media report cited the Centre for Monitoring Indian Economy Ltd. data which claimed that jobless rate has risen to more than two-year high. In a post on X, Ramesh said, "India's growing Modi-Made economic crisis continues to spiral out of control. CMIE data shows that unemployment rate in India is now at above 10%, the highest in over 2 years when it already was the highest ever in five decades. Rural unemployment is 10.8%." "The unemployment distress is further proved with the record demand for employment under MGNREGA, which is the last resort of work for crores of Indians. It is up 20% from last year," the ...

Nawaz Sharif to unveil Pakistan recovery plan at Minar-e-Pakistan gathering

Pakistan's self-exiled former prime minister Nawaz Sharif will give a road map to pull the cash-strapped country out of the economic mess during his gathering here in the capital of Punjab province on October 21, a media report said on Monday. The Lahore district administration on Sunday allowed the Pakistan Muslim League-Nawaz (PML-N) party to hold a gathering at the Minar-e-Pakistan after the former ruling party sought permission in a bid to whip up support for its supreme leader's return later this week, Dawn news reported. Speaking to workers at a party convention in Mustafabad, PML-N Vice President Hamza Shehbaz said Pakistan will restart its journey towards progress and prosperity with the return of the PML-N supreme leader later this week. In his address at Minar-e-Pakistan, Nawaz Sharif will give a road map to pull the country out of the economic mess, Hamza Shehbaz, the nephew of Nawaz Sharif, said. He said the PML-N and its allies saved the country while risking their ...

Pakistan's foreign debt ratio rises amid ongoing economic crisis: Report

The ratio of foreign debt of cash-strapped Pakistan has shot up from 36.9 per cent in FY22 to 38.3 per cent in FY23, according to a media report on Friday. The Ministry of Finance's Annual Debt Review and Public Debt Bulletin FY2023 comes amid unchecked domestic inflation as the cash-strapped Pakistan's economy has been in a free-fall mode for the last several years. Terming it as an alarming development, Geo News said, the FY2023 Bulletin shows that the total public debt peaked at Rs 62.88 trillion till the end of June 2023 against Rs 49.2 trillion, indicating that the total public debt increased by Rs 13.64 trillion during the last fiscal year 2022-23 in the tenure of Pakistan Democratic Movement (PDM) coalition government. After giving details of the total outstanding guarantees to public sector enterprises, those issued to the oil and gas sector and the guarantees issued against commodity operations, the report said, the ratio of domestic debt to total public debt in percentage

Despite signs of stabilisation, full recovery not assured: IMF on Sri Lanka

At the end of the mission, Breuer and Svirydzenka said in a statement that Sri Lanka has made commendable progress in implementing reforms

Former PM Nawaz Sharif likely to return to Pakistan in October: Report

Ending his over four years of self-imposed exile in the UK, former prime minister Nawaz Sharif is likely to return to Pakistan next month, according to a media report on Saturday. Quoting sources present at a meeting in London where Sharif, the supreme leader of the Pakistan Muslim League-Nawaz (PML-N), was speaking to his party workers, the Dawn newspaper reported that he spoke about his return, but a clear date for travel has not been disclosed. Sharif, 73, has been living in self-imposed exile in London since November 2019. He was convicted in the Al-Azizia Mills and Avenfield corruption cases in 2018. He was serving a seven-year imprisonment at Lahore's Kot Lakhpat jail in the Al-Azizia Mills case before he was allowed to proceed to London in 2019 on medical grounds. PML-N workers at the meeting were eager to prepare for their leader's return and were discussing the logistical details of his comeback. Sharif confirmed his return to Pakistan in October, the Dawn report said. The

China assures SL of help in addressing debt challenges before IMF's review

Sri Lanka's largest bilateral creditor, China, has assured the island nation its help in effectively addressing the debt challenges as it has to finalise the external and domestic debt restructuring of a whopping USD 41 billion by September before the IMF's first review. The International Monetary Fund (IMF) is set to conduct its first review of the USD 2.9 billion bailout granted to Sri Lanka in March this year from September 11-19. A release from the Prime Minister's Office on Wednesday said Wang Yi, the Foreign Minister and Director of the Office of the Foreign Affairs Commission of the ruling Communist Party of China (CPC) Central Committee who met Sri Lanka Prime Minister Dinesh Gunawardena on the sidelines of the seventh China-South Asian Expo assured that it will help in effectively addressing the country's debt challenges. China is always Sri Lanka's reliable strategic partner and appreciates that Sri Lanka has always been friendly to China and has stood by China on issues .

Sri Lanka records single-digit inflation for 1st time since economic crisis

Cash-strapped Sri Lanka on Monday said that its inflation has dropped to 6.3 per cent, a single-digit figure for the first time in two years, providing much-needed relief to the people amidst the worst financial crisis. In a statement, the Census and Statistics Office of the Sri Lankan government said that the overall rate of inflation as measured by the Colombo Consumer Price Index on a year-on-year basis is 6.3 per cent in July 2023 and it was down from 12 per cent recorded in June this year. The overall rate of inflation as measured by the Colombo Consumer Price Index on a year-on-year basis is 6.3 per cent in July 2023. This was down from the 12 per cent recorded in June, the statement said. The last time single-digit inflation was recorded was 5.8 per cent in September of 2021. The highest inflation since the island nation's economy came under its worst crisis was 69.8 per cent recorded in September last year. The statement further said that the decrease in the cost of food ..