February 2, 2023

Crisis-hit Sri Lanka expands cabinet, but no finance minister

University students and police clash during a demonstration demanding the resignation of Sri Lanka's President Gotabaya Rajapaksa over the country's economic crisis

University students and police clash during a demonstration demanding the resignation of Sri Lanka’s President Gotabaya Rajapaksa over the country’s economic crisis – Copyright AFP Ishara S. KODIKARA

Cash-strapped Sri Lanka appointed nine more ministers Friday to an “all-party government” tasked with trying to steer the country out of its economic crisis, but the crucial finance portfolio remains vacant.

Prime Minister Ranil Wickremesinghe took over earlier this month after Mahinda Rajapaksa, the president’s elder brother, resigned as escalating protests blamed his administration for leading Sri Lanka’s economy to the brink of collapse. 

Wickremesinghe had pledged to put together a cross-party coalition after the previous cabinet was dissolved.

The new ministers — for health, education and justice, among others — were sworn in before President Gotabaya Rajapaksa at his tightly-guarded official residence in Colombo, the government said in a brief statement.

Two legislators from the main opposition SJB party broke ranks to join the new government. 

Another opposition party, the Sri Lanka Freedom Party, agreed to support President Rajapaksa and was given one portfolio on Friday.

The finance position — which will bring with it responsibility for leading negotiations with the International Monetary Fund over a bail-out — remains vacant. 

But the new prime minister’s office told AFP that someone would be appointed next week. 

The delay in getting a finance minister could hinder the IMF negotiations, the central bank chief warned on Thursday.

Sri Lanka is facing its worst-ever shortage of foreign exchange with the government unable to finance even the most essential imports such as food, fuel and medicines.

The country of 22 million people has been enduring severe economic hardships for months. 

Consumers have been unable to access petrol, diesel and cooking gas while staple food has been rationed. The country is also facing record inflation and lengthy daily electricity blackouts.

The government shut offices and schools on Friday as the petrol shortage crippled transport across the country.

But officials said the government had managed to raise the $53 million necessary to pay for a petrol shipment which arrived at the Colombo port this week.

Retail pumping stations could be supplied over the weekend, officials said.

The Central Bank of Sri Lanka announced Thursday that it will not be able to resume foreign debt repayments for at least another six months until the country’s external debt of $51-billion is restructured.