What is Sri Lanka’s history?
Sri Lanka is a tiny island nation on the Indian Ocean near the coast of South India. It’s a beautiful country filled with beaches, mountains, and greenery. It’s so beautiful that people from all over the world come to visit it.
So, what’s going on in Sri Lanka today?
Since September 2021, the economy of Sri Lanka has been very bad. People don’t have money to buy food and medicine. They don’t have electricity for almost 13 hours a day because the government doesn’t have any money for fuel.
How did things get so bad?
The government made some bad decisions. Some bad things happened in the world. Together, these destroyed Sri Lanka’s economy:
1. The government borrowed money from many countries, including China, to build roads, bridges, buildings, etc. But it has no money to pay them back.
2. Tourism was one of the biggest ways Sri Lankans earned money. Since the pandemic, tourists have stopped visiting the country.
3. The President of Sri Lanka, Gotabaya Rajapaksa, reduced the taxes that citizens have to pay as soon as he won the elections in 2019 to make his voters happy. As a result, the government could not collect the money it needed to run the country.
How are India and other countries helping out?
India loaned Sri Lanka $1.5 billion. China donated one million tons of rice. The Sri Lankan government is getting ready to go to the International Monetary Fund (IMF) for help. The IMF is an international organisation that helps countries around the world to do business with each other.
So, will giving Sri Lanka a lot of money solve its problem?
No, this money won’t last long. Real change will come when two things happen: (i) the government makes better monetary decisions; and (ii) tourists start visiting Sri Lanka again. This is the worst crisis Sri Lanka has faced since it gained independence in 1948. But Sri Lankans are strong. They will soon overcome this challenge.
