Colombo: Sri Lanka’s Parliament on Tuesday approved the 2024 budget, emphasising the need for tough reforms until the full recovery of the cash-strapped island nation’s economy.
Although Sri Lanka has managed to control its hyperinflation in the ongoing economic crisis, its economy is far from being fully recovered.
President Ranil Wickremesinghe, who is also the Finance Minister, on November 13 presented the budget emphasising awareness of the hard times that will continue until a full economic recovery can be achieved.
The Second Reading of the 2024 budget was passed in Parliament on Tuesday with 122 members voting for and 77 against it in the 225-member Assembly, Speaker Mahinda Yapa Abeywardena said. Presenting the budget in Parliament, the President said that advancing a nation requires more than mere fairy tales. He recalled that the prolonged reliance on election promises by political parties has historically led to the economic bankruptcy of the country.
The 2024 budget allocates funds to improve facilities for tourists, address housing issues in the country, including in the North, and improve domestic cricket. The Second Reading debate of the Appropriation Bill (Budget) was held for 7 days from November 14th to the 21, excluding Sundays, the Colombo Gazette reported.
The voting in favour happened despite a few ruling Sri Lanka Podujana Peramuna members expressing unhappiness over the budget proposals. Wickremesinghe with support from just three of his own, relies on the support of the Rajapaksa family for the parliamentary majority to keep his government afloat.
The SLPP had expected more relief measures in the budget for the economic slump. All that Wickremesinghe could offer was an increase in the cost of living allowances for 1.3 million state employees and pensioners numbering 700,000.
Wickremesinghe later said the country’s economic recovery cannot be underwritten by just one government budget presentation.
While the budget was being debated, the government suffered an embarrassment in the form of the highest court ruling that the Rajapaksa brothers and their financial manager bureaucrats were responsible for the economic slump which resulted in the island declaring bankruptcy.
Wickremesinghe is yet to see a fruitful end to the ongoing external debt restructuring talks. The IMF since mid-September has held back the release of the second tranche of the USD 2.9 billion four-year bailout pending external debt negotiations.
Sri Lanka declared economic bankruptcy in April 2022 by announcing its first-ever sovereign default. The island nation was hit by its worst financial crisis in history, with its foreign exchange reserves falling to a critical low and the public coming out on the streets to protest the shortage of fuel, fertilisers and essential commodities.
Sri Lanka’s economy contracted 7.8 per cent in 2022.
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