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Past Govts. failed to follow IMF advice: Nalaka Godahewa

25 Mar 2022

The Governments of the past have not followed the advice given by the International Monetary Fund (IMF), thus the country has had to approach the IMF repeatedly, said State Minister of Urban Development, Waste Disposal and Community Cleanliness Nalaka Godahewa. He made this statement during an interview on a television program today (25). "The reason as to why the previous Governments of Sri Lanka has always had to rely on the IMF and repeatedly approach the IMF for relief for over 16 times is because the Governments had never followed the exact advise given by the IMF. Though the people are making a scene now, even the Yahapalanaya government had approached the IMF. Politicians have always in the past given temporary relief to the people just to take votes. The way the IMF advises us and the ideology of the Governments are very different" said Dr Godahewa. When further questioned whether approaching the IMF was a bad idea, Dr Godahewa said that he personally doesn't think so. "I feel approaching the IMF is not a bad thing. Maybe their proposals and our principals might clash, but if the Government follows at least 60% of the advise given by the IMF, we will see a vast change in the current economic crisis we are facing. Following the advise 100% would be difficult, but some things can be taken productively. We see everyone talking about the economic crisis in the country, but we barely see people coming up with solutions. For example, Sri Lanka's taxes are very low, we cannot run a country at this rate. The IMF will surely advise the same," he said. Dr Godahewa goes on to detail the 'structural issues' faced in the economic system in the country at present. "The IMF and leading economists in the country have always pointed out that there are structural issues in the country's economy and adjustments must be made. This is what we need to be talking about and addressing. For example, loans, debt restructuring, trade and taxes. All these needs looking into," he stated. During the interview, Dr Godahewa also mentioned that the main cause of the shortage in LP gas and Fuel is due to the lack of dollars, but the lesser of either should be attended to as a priority. "The country is facing a shortage in LP gas and Fuel is due to the lack of US Dollars. If you see, LP gas is cheaper than fuel, and that issue should be resolved as a matter of priority. This is simple logic, and this will ease the burden of the general public in at least a small way. Sri Lanka's economic crisis did not erupt within the last 2 years, this has been an ongoing problem that has now spiraled into a big crisis with the pandemic adding to the problems," he mentioned. When additionally asked whether the economic crisis would have been easier to tackle if the Government had approached the IMF back in 2020 when the pandemic started, Dr Godahewa stated that there wouldn't have been much of a change either way. "The issues in 2020 and the issues faced now are different situations. I cannot say it would have been less of an economic crisis if the Government approached the IMF back in 2020, as the IMF also provides solutions and advise based on the situation at hand," said Dr Godahewa. He also mentioned that it was very important that the general public be informed thoroughly about the ongoing economic crisis as it was their right to know the truth and that people would then also have a better understanding of the situation.


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