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Sri Lankan public-sector workers strike in protest against tax hikes

SRI LANKAN health, railway, port and other public-sector workers went on strike today in protest at sharp increases in income taxes and electricity charges.

The 24-hour walkout came as the island nation awaits approval of an International Monetary Fund package to rescue its bankrupt economy.

The stoppage defied a ban imposed by President Ranil Wickremesinghe last month, when he insisted that anyone going on strike risked being sacked.

Union spokesman Haritha Aluthge said that talks with authorities ahead of the strike had failed to reach a deal.

Most public-sector hospitals suspended outpatient clinics because doctors, nurses and pharmacists were on strike.

Railway services were also hit, with far fewer trains operating. Many of those that were in service had armed guards on the carriages to protect against violence or sabotage by strikers. 

According to authorities, most state banks opened despite the strike.

Trade unions say that the increase in taxes and electricity charges have hit their members hard amid the country’s worst economic crisis.

They have said they could extend the strike indefinitely if the government fails to address their demands.

However, the Professionals Trade Union Collective said it would suspend its strike this morning, as the president had pledged that its demands would be taken into consideration. 

The government says that the tax increases are necessary to boost its revenue and the higher electricity charges are to cover production costs,  both being key prerequisites to unlocking the proposed $2.9 billion (£2.4bn) IMF package.

Last week, IMF managing director Kristalina Georgieva said that the fund’s board would meet next Monday to consider whether to give final approval to Sri Lanka’s bailout package after China provided crucial debt-restructuring assurances.

Mr Wickremesinghe told parliament last week that difficult reforms were needed to remain on course with the IMF programme, warning that any repeat of past failures to do so would compel Sri Lanka to repay $6-7bn (£4.9-5.8bn) of foreign debt every year until 2029.

Sri Lanka’s government announced last year that it was suspending repayment of its foreign loans amid a severe foreign currency crisis that caused shortages of fuel, food, medicines and cooking gas, along with long power cuts.

The crisis led to street protests and an occupation of the presidential palace which together forced then president Gotabaya Rajapaksa to flee the country and resign.

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