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Political instability erodes investor- confidence worsening financial crisis: Rajapaksa
Former president Mahinda Rajapaksa yesterday said the Government has lost the confidence of investors and the continuing political instability will see the country’s financial crisis worsening.
Speaking at a media briefing at his official residence at Wijerama Mawatha, Colombo 7, Mr Rajapaksa stated that, as long as the Government and the country were unstable, investors will not be keen to invest. “When there is open conflict between the President and the PM, such instability is inevitable,” he pointed out.
The former president severely criticised what he claimed was the Government’s complete mismanagement of the financial crisis, which has resulted in the LKR plunging to record lows against the US$. He noted that, when he handed over power to the new Government, the country’s total debt was 71% of the Gross Domestic Product (GDP). Today, it has risen to 87% of GDP, he stressed, adding that the country’s total debt now stood at Rs 11, 971 billion.
He recalled that, during his tenure as president, Sri Lanka was one of the few countries in the region to escape the Asian financial crisis. “This was because we, as the Government, Finance Ministry and the Treasury, were constantly vigilant about the depreciation of the LKR. We took decisive measures to prevent it from rapidly depreciating. Such leadership is sorely lacking today. If the President, Prime Minister and the Finance Minister and others in the Government keep saying that the currency will continue to depreciate, then that is exactly what will happen.”
Mr Rajapaksa said the crisis will directly impact the public, adding it was now time for the Government to acknowledge its failure to control the situation and take necessary remedial measures, without blaming the Opposition for everything.