COLOMBO (Sri Lanka) -- President Gotabaya Rajapaksa of Sri Lanka said Wednesday that he called Vladimir Putin, the Russian leader, to request credit support for fuel imports to the island nation which is currently in its worst economic crisis since memory.
"Had an extremely productive telecon meeting with President Vladimir Putin of Russia. Rajapaksa tweeted that he thanked Putin for his support in the past and requested credit support to help me import fuel to #lka to defeat the current economic challenges.
In response to sanctions imposed by Russia's war on Ukraine, the majority of Western countries have stopped importing energy from Russia. Ranil Wickremesinghe, the Prime Minister of Sri Lanka, stated earlier that his government would seek out other sources but this has not been achieved.
The global oil price has soared since Russia invaded Ukraine in February. This has prompted many countries to look for Russian crude which is being sold at steep discounts.
The economic crisis in Sri Lanka has caused a severe shortage of fuel, causing the government to close schools and ask staff to work remotely to reduce the consumption of the few stocks. The government stated earlier that no one is willing to supply oil to Sri Lanka for cash, as its petroleum corporation owes large amounts.
In April, Sri Lanka stopped repaying foreign debt due to its currency crisis. This was in anticipation of the outcome of negotiations with International Monetary Fund regarding a bailout package. Wickremesinghe said Tuesday to Parliament that talks with the IMF were complicated and difficult as Sri Lanka is now bankrupt.
This is a change from the past when Sri Lanka was a developing country and entered into negotiations. Before any agreement can be reached, it will need to submit a debt sustainability report for approval to the IMF.
Sri Lanka has $ 51 billion in foreign debt. It must repay $28 million by 2027. This means that Sri Lanka will have to pay $5 billion per year for the next five.
For the past few months, Sri Lankans have had to wait in long lines to purchase fuel, cooking gas, and food. The crisi has triggered months-long street protests as well as scuffles at gas stations with police.