Power and Energy Minister Kanchana Wijesekera announced electricity prices by 66% raised on Thursday...

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Edited by|Hugh Gey
Economy section- CJ journalist
16 Feb.2023- Sri Lanka - REUTERS - CJ editing

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         Srilanka faces critical issues in its economy and tries to put an end to its government but failed to prevent the fall of its economy matter which pressured the country to increase the power prices by 66%.
The government's decision comes after another previous raise which happened last year for electricity prices by 75 percent and adds to the pain of Sri Lankans already struggling with inflation above 54% year-on-year in January and income taxes as high as 36% percent.
the official responsible said ;
' We know that this will be hard on the public, especially the poor, but Sri Lanka is caught in a financial crisis and we have no choice but to move towards cost-reflective pricing," Wijesekera told reporters.

According to the officials said that his country try to persuade the IMF ( the International Monetary Fund ) to give them A loan with 2,9 BLN and save the country from its crisis.

"We hope that with this step Sri Lanka has moved closer to getting the IMF program."

The IMF agreed to loan Sri Lanka $2.9 billion in September to overcome its worst financial crisis in seven decades, but the deal comes with conditions that include raising taxes, removing subsidies, and cutting public sector debt.

The government of President Ranil Wickremesinghe, who took over after mass protests against economic mismanagement ousted his predecessor last year, desperately needs the funds and has been courting multilateral agencies for support since taking office in July.

Wijesekera said the price increase would help the power ministry offset the gap caused by the cessation of government subsidies from January, and also help better manage long-term fuel contracts.

The government hopes to reduce tariffs by July when it plans to revise prices again, he said.

Analysts forecast the power price hike to further increase inflation. "We are projecting inflation to increase slightly to 55.5% next month but overall inflation will continue downward given the high base effect from last year," said Dimantha Mathew, head of research, at First Capital Holdings.

Inflation hit a record 73.7 percent in September last year.

"We can't bear these costs anymore," said Asela Sampath of the All Island Canteen Owners Association, a group that represents the restaurants sector frequented by middle to low-income Sri Lankans. "We ask for forgiveness from consumers, but we have no choice but to pass down these costs."