Sri Lanka to turn off street lights, faces longest-ever blackout as economic crisis deepens

Diesel - the main fuel for buses and commercial vehicles - was unavailable at stations across the island. PHOTO: AFP

COLOMBO (AFP, REUTERS) - Sri Lanka is turning off its street lights to save electricity, a minister said on Thursday (March 31), as its worst economic crisis in decades brought record-long power blackouts and gloom to its main stock market, triggering a halt in trade as prices slid.

The island nation of 22 million people is struggling with rolling power cuts for up to 13 hours a day as the government is unable to make payments for fuel imports because of a lack of foreign exchange.

“We have already instructed officials to shut off street lights around the country to help conserve power,” Power Minister Pavithra Wanniarachchi told reporters.

A diesel shipment under a US$500 million (S$676 million) credit line from neighbouring India is expected to arrive on Saturday, Wanniarachchi said, but she warned that the situation was not likely to improve any time soon and could drag on until May.

“Once that arrives we will be able to reduce load shedding hours but until we receive rains, probably some time in May, power cuts will have to continue,” Wanniarachchi told reporters, referring to the rolling power cuts.

“There’s nothing else we can do.” Water levels at reservoirs feeding hydro-electric projects had fallen to record lows, while demand had also hit record levels during the hot, dry season, she said. 

Protesters on Thursday gathered near the President’s residence in Pengiriwatte road in Mirihana, Sri Lanka's News 1st website reported.

Many held up placards to protest against the rising cost of living, gas and fuel shortage, in addition to the electricity crisis, the report said.

Diesel - the main fuel for buses and commercial vehicles - was no longer on sale across the country on Thursday.

Petrol was on sale but in short supply, forcing motorists to abandon their cars in long queues.

"We are siphoning off fuel from buses that are in the garage for repairs and using that diesel to operate serviceable vehicles," Transport Minister Dilum Amunugama said.

Owners of private buses - which account for two-thirds of the country's fleet - said they were already out of oil and that even skeleton services may not be possible after Friday.

"We are still using old stocks of diesel, but if we don't get supplies by this evening, we will not be able to operate," chairman of the private bus operators association Gemunu Wijeratne told AFP.

The South Asian nation is in the grips of its worst economic downturn since independence, sparked by an acute lack of foreign currency to pay for even the most essential imports.

The state electricity monopoly said they would be forced to enforce a 13-hour power cut from Thursday - the longest ever - because they did not have diesel for generators.

"We are promised new supplies in two days and if that happens, we can reduce the length of power cuts," Ceylon Electricity Board chairman M. M. C. Ferdinando told reporters.

He said hydro reservoirs, which provide more than a third of electricity demand, were also dangerously low.

The lengthy power cuts forced the Colombo Stock Exchange to limit its trading by half to two hours, while many offices asked non-essential staff to stay at home.

The electricity rationing also hit mobile phone base stations and affected the quality of calls, operators said, adding that their stand-by generators were also without diesel.

The shortages have sparked outrage across Sri Lanka, with local television reporting protests across the country as hundreds of motorists block main roads in several towns.

Several state-run hospitals have stopped surgeries as they have run out of essential life-saving medicines, while most have stopped diagnostic tests which require imported chemicals that are in short supply.

Colombo imposed a broad import ban in March 2020 in a bid to save foreign currency needed to service its US$51 billion (S$69 billion) in foreign debt.

But this has led to widespread shortages of essential goods and sharp price rises.

The government has said it is seeking a bailout from the International Monetary Fund while asking for more loans from India and China.

Sri Lanka's predicament was exacerbated by the Covid-19 pandemic, which torpedoed tourism and remittances.

Many economists also blame government mismanagement including tax cuts and years of budget deficits.

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