This visit comes days after Tuesday’s announcement by the finance ministry that it would suspend repayments of foreign loans.
On Sunday, a delegation from Sri Lanka will travel to the United States to meet with IMF officials to discuss a $4 billion package. This is as the government desperately attempts to save the country’s struggling economy that a severe forex crisis has ravaged.
Between April 19 and 24, Finance Minister Ali Sabry’s delegation will meet with representatives from the International Monetary Fund.
After having previously resisted requests to obtain a facility from the international lender, Mr Sabry stated that Sri Lanka wants a $4 billion bailout package from the IMF.
The visit is taking place days after the finance ministry announced that it is suspending repayments of foreign debt, including bonds and government-to-government borrowing, pending the completion of a loan restructuring programme with the International Monetary Fund (IMF). This year, Sri Lanka was required to pay $7 billion in debt payments.
This was Sri Lanka’s first debt default since 1948. The country’s 22million inhabitants are now facing 12-hour power outages and severe shortages of fuel, food and medicines.
The Securities and Exchange Commission of Sri Lanka (SEC) announced Saturday that the Colombo Stock Exchange would remain temporarily closed from Monday to give investors “more clarity and understanding” of current economic conditions in crisis-hit Sri Lanka. This will allow them to make informed investment decisions.
Sri Lanka was currently facing the worst economic crisis since 1948, when it gained independence from the UK. The financial crisis triggered political turmoil in Sri Lanka, with residents staging nationwide protests over prolonged power cuts, fuel shortages, and the demand for the ouster of President Gotabaya Rajapaksa.
After thousands of protestors defied the country’s state of emergency and curfew, all of Sri Lanka’s Cabinet resigned earlier this month except President Gotabaya and Prime Minister Mahinda Rajapaksa.
Sources claim that President Gotabaya has made arrangements for the swearing-in of a smaller Cabinet. Other than Prime Minister Mahinda, it will not include any Rajapaksa member.
President Gotabaya fired Basil Rajapaksa, his brother and finance minister, earlier. He invited the Opposition parties into a unity cabinet to address the public’s anger against the economic crisis. The Opposition turned down the invitation to form a unity Cabinet. Next week, the Opposition will move a no-confidence against the government.
An Indian credit line of $500,000,000 for fuel imports was created to help the country’s dire financial situation.
India announced recently that it would extend Sri Lanka a $1Billion line of credit as part of its financial aid to the country to address the economic crisis. This follows a previously $500B line of credit in February, used to purchase petroleum products.
President Rajapaksa defended his government’s actions by stating that the foreign exchange crisis wasn’t his fault. The economic downturn was largely caused by pandemics, with the island nation’s tourism revenue declining and its inward remittances decreasing.
AfCFTA gives Africa the power to influence global politics and trade.
Six European countries formed the European Economic Commission in 1957. In 1957, six European nations joined forces to form the European Economic Commission. The Treaty of Rome was signed, and a regional European economic bloc was created. The European Union (EU), established in 1965, is still the most significant political and economic bloc in Europe.
It is a regional bloc that includes 27 member countries who work together in many areas, including commerce, trade, citizenship, and free movement of people and goods. The EU’s influence is felt worldwide and has influenced many political and economic decisions.
African heads of state met in 2021 to agree to accelerate and increase intra-continental trade and create a free trade zone. The agreement to establish the African Continental Free Trade Area was signed in 2018. The deal was ratified by 36 of 54 African countries as of 2021.
This agreement will transform African markets for the benefit of Africans. Its key goals include creating a single demand for African goods and liberalization of African markets.
This means that African countries will open their borders to intra-African trade of goods and services.
One of the many benefits of AfCFTA is the ease with which goods and services can be imported and exported.
It will be easier and more affordable to import and export goods and services to other African countries due to the gradual harmonization of trade practices. This will allow for expansion to other countries.
The market will experience greater competition if it opens its borders for trade.
This will benefit consumers as the suppliers will increase quality and lower prices to gain market share. The integration brings about a liberalization that has positive effects on consumer welfare.
The main benefit of the bloc for African states is that it will give the continent a stronger voice in international political and trade negotiations.
The AfCFTA could provide a platform for African nations to speak together on global issues. Given its size and population, the AfCFTA will be the most prominent regional bloc worldwide. This is a huge advantage.
African countries can also negotiate continental trade issues that impact African states.
AfCFTA can address counterfeits and trade of sub-standard and illicit goods.
Through the AfCFTA, African countries can harmonize trade practices to minimize dumping. The AfCFTA allows the continent to tackle dumping through solid laws.
Borders between national units
Protocols adopted by the AfCFTA have already addressed some issues. This means that there is an element of implementation underway. Protocol on Trade in Services is one of these. Protocol Article 10 provides for mutual recognition agreements.
The national professional bodies issue licenses to experts operating in a country. This license is only valid for the country’s borders. They would need to seek licensure to offer services in another nation. This is often a strict requirement for foreigners.
A Kenyan lawyer cannot practice in Ugandan courts without a license.
Article 10 of the Protocol allows for trade in services, allowing countries to recognize licenses and other approvals mutually. However, this will be done gradually.
It is possible to export professional services to other countries if MRAs are signed and sector regulations passed in member states.