The unprecedented economic crisis in Sri Lanka could turn into a “full-blown humanitarian” emergency, a senior official of the United Nations warned, as food and fuel supplies run dangerously low, putting almost 1.7 million of the total 22 million people at most risk.

“We are concerned that this could develop into a full-blown humanitarian emergency, and we are taking action to address that concern,” Jens Laerke, spokesman for the UN humanitarian agency OCHA, was quoted as saying by The Morning. Over 56,000 children are facing acute malnutrition. 

Faced with its worst economic crisis since its independence in 1948, Sri Lanka, which had lately emerged as an import-driven economy, has exhausted almost all of its foreign exchange reserves, resulting in an acute shortage of food, fuel, and other essentials. The government has been in talks with the IMF, hoping to receive assistance, but that is unlikely to come before October this year.
Colombo has also declared pre-mature default on all of its external debt obligations, totaling around $51 billion, including $5 billion loans extended by China. For now, the government is dependent on bilateral and multilateral donors to pay for essential imports. Last week, the UN and its partners appealed for $47 million, which will be needed to address the immediate needs of the 1.7 million of the most vulnerable people.

The food crisis is all set to worsen in the coming months, as the supply of both fertilizer and fuel runs low, forcing many farmers to skip paddy cultivation in this current season. The agriculture productivity, a senior minister said, is likely to be 50 percent this year.

Last week, India, which has extended assistance worth over $3.5 million, extended another $55 million for the import of fertilizer. However, the country of 22 million people needs around $500 million for the import of fertilizers.

China, earlier one of Sri Lanka’s largest creditors, has not yet provided any significant relief. Last week, Beijing, while acknowledging India’s efforts, said it will work with them to help Sri Lanka.

“We’ve taken note that the Indian government has also done a lot in this regard. We commend those efforts. China is ready to work with India and the rest of the international community to help Sri Lanka and other developing countries experiencing difficulty to pull through the hardship as early as possible,” Zhao Lijian, spokesperson of China’s Foreign Ministry said.
Significantly, in a recent interview to WION TV, Prime Minister Ranil Wickremesinghe said that Beijing hadn't responded to Colombo's request for the debt restructuring. The existing line of credit of $1.5 billion, earlier extended by China, could also not be used, because one of the terms in the agreement mandates Sri Lanka to maintain at least three months of foreign exchange reserves.
The government is now considering addressing the food shortage by procuring the land to run a state-run cultivation program. Mahinda Amaraweera, the country’s agriculture minister, said this land will be given to youth for food cultivation. However, doubts remain as to how this step will address the key issue, the shortage of fertilizers and fuel.  

(SAM)