Sri Lanka facing severe foreign exchange crisis: Finance Minister Basil Rajapaksa

Rajapaksa said state coffers also suffered huge revenue losses due to the COVID-19 outbreak. Rajapaksa told Parliament on Tuesday, September 7, 2021, that Sri Lanka was facing a severe external crisis as well as a domestic crisis with revenues falling and expenses continuing to rise.

“Our country is facing a severe foreign exchange crisis,” he said, adding that data from the central bank shows the country’s net foreign exchange reserves are close to zero, which means almost all of its reserves are borrowed.

“Due to COVID-19, the government’s revenue so far for this year has fallen between 1500-1600 billion rupees from the estimated amount,” the younger brother of President Gotabaya Rajapaksa and Prime Minister Mahinda Rajapaksa, told the House. The Sri Lankan economy - which depends heavily on tourism and exports of commercial crops like tea - was battered by the pandemic.