Sri Lanka is on the verge of high economic crisis, Risk of being blacklisted in Europe – Bower Group Asia

A leading investment consulting firm in the Indo-Pacific region warns its clients that Sri Lanka will not be able to prevent the people of Sri Lanka from starving or provide them with a proper economic stimulus due to the current foreign reserve crisis, international debt repayments and poor fiscal management Done.

The company had pointed out that it was urgent to seek the assistance of the International Monetary Fund (IMF) to resolve the current external crisis in the country, which has led to a shortfall in US dollars.

They noted that increasing government current account deficit, declining foreign exchange reserves and a drastic reduction in revenue increase the risk of the Sri Lankan rupee depreciating sharply.

Also said that the stability of Sri Lanka’s main export market is also under threat due to human rights and political issues and the island will lose the concessions it has had to enter the EU for ready-made garments.

It further stated that from the end of May, Sri Lanka’s gross foreign exchange reserves had fallen to $ 4 billion, and the report showed that the need for external credit services alone was close to $ 7 billion over the next 12 months and because of that the existing reserves were by no means sufficient for the country.

The company has warned its investors that a severe economic storm is imminent if Sri Lanka does not take appropriate action.