Lanka’s poverty alarmingly high

AFP :

About a quarter of cash-strapped Sri Lanka’s population was living in poverty despite the economy making a “remarkable recovery” from its worst financial meltdown, the World Bank said on Wednesday.

The South Asian nation’s growth surpassed the Bank’s forecast of 4.4 percent, recording 5.0 percent in 2024 — the first economic expansion since the 2022 crisis.

“While the economy is recovering, many Sri Lankans are still struggling… the poverty rate remained alarmingly high at 24.5 percent in 2024,” the Bank said in its latest update on the island.

“The labour market continues to struggle, leading to increased emigration as people look for opportunities abroad. Household incomes, employment and overall welfare remain well below pre-crisis levels.”

The Bank said wages have yet to catch up to their 2019 levels. Since then, poverty — measured by those earning less than $3.65 a day — has doubled.

The Bank projected that growth would moderate in 2025 to 3.5 percent, partly due to global trade uncertainties triggered by the sharp increase in US tariffs.

Sri Lanka defaulted on its foreign debt of $46 billion in April 2022 after running out of foreign exchange to finance imports such as food, fuel and medicines.