COLOMBO: Nearly 1,000 bakeries have closed in Sri Lanka due to a severe shortage of cooking gas, an industry association said on Monday (Mar 7), as the impact of dwindling foreign exchange reserves ricochets through the country's economy.
The island nation is facing its worst financial crisis in a decade with foreign exchange reserves shrinking 70 per cent to US$2.36 billion in January, leaving the government struggling to pay for imports including food, medicine and fuel.
People are lining up at fuel pumps across the country and a shutdown of multiple power plants has led to rolling power cuts, sometimes lasting more than seven hours a day.
The cooking gas shortage has almost doubled bread prices to about 150 rupees (US$0.75) in some urban areas, NK Jayawardena, chairman of the Ceylon Bakery Owners Association, said.
"If this situation lasts for one more week, 90 per cent of bakeries will have to close. Many bakers have taken out loans, they will not be able to repay them," said Jayawardena, whose association, the largest in the sector in the country, represents about 7,000 members. "The government must find a solution urgently."
Two government spokesmen could not be immediately reached for comment on the bakeries but ministers have said they are working to normalise fuel distribution.
While bread products are not such a vital staple as rice, nearly every village and town would have at least one bakery supplying bread for curries and snacks to families and workers.