At least half a million people in Sri Lanka lost their jobs in 2022, majority of them being employed women and those in the industry and services sectors, the World Bank claimed.
According to the Vice President for the South Asia Region of the World Bank Group, those already classified as poor in Sri Lanka have seen a 65% increase in their cost of living, while the increase was 57% for the non-poor, highlighting the significant loss of welfare for all Sri Lankans.
In a piece of writing on the island’s crisis situation, Raiser attributed Sri Lanka’s economic adversity to years of economic mismanagement, weak governance, poor policy choices and the impacts of external shocks such as the Covid-19 pandemic and Russia’s invasion of Ukraine.
Raiser noted that the depth of the crisis has made it clear that Sri Lanka needs a new development model. However, the road to recovery is challenging and the necessary fiscal adjustment measures can be painful, he added.
Debt relief from Sri Lanka’s creditors and fresh financing from international financial institutions are thus urgent to ensure people don’t lose patience with reforms and the opportunity for a change is not lost.