Sri Lanka’s crisis-hit economy shrank a record 7.8 percent last year as long blackouts and critical fuel shortages put a chokehold on local commerce, official data showed Thursday.
An unprecedented economic crisis sparked huge protests in the island nation, culminating last July when a mob stormed the home of then president Gotabaya Rajapaksa, forcing him to flee the country and resign.
Since then a new government has worked to repair Sri Lanka’s battered public finances and secure a sorely needed International Monetary Fund (IMF) bailout.
Last year’s contraction — the biggest in the country’s 75 years of independence — compared with 3.5 percent growth in 2021 and a 4.6 percent contraction in 2020 as the coronavirus pandemic hit.
It was “caused by the deepening of the economic crisis… frequent power disruptions, shortages in fuel, raw materials, (and) foreign currency”, Sri Lanka’s census and statistics department said in a statement.
The data showed some improvement in Sri Lanka’s fiscal position with inflation moderating to about 50 percent in February, down from a record high of 69.8 percent in September.
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