‘Dinana Dakuna’ warns of real income collapse despite economic stability

Friday, 28 August 2026 - 17:00

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The 'Dinana Dakuna' collective states that the real income collapse and poverty crisis faced by the public in Sri Lanka cannot be concealed merely by managing the economy under International Monetary Fund conditions.


The collective points out that the recently released Visual Capitalist Global Minimum Wage Index clearly illustrates the crisis surrounding the real purchasing power of the Sri Lankan public. According to the index, Sri Lanka ranks 120th out of 130 countries in terms of purchasing power, with the real purchasing power of Sri Lanka's minimum wage recorded at 200 United States dollars per month.


Citing the United Nations Development Programme Multidimensional Vulnerability Index report, Dinana Dakuna further highlights that 55.7 per cent of the population, amounting to over 12.3 million people, are exposed to multidimensional vulnerability across sectors including education, health, indebtedness, and living standards.


The collective notes that the poverty rate in the country exceeds 25 per cent, and more than one-third of the population has been compelled to obtain loans or pawn items to satisfy basic needs such as food and medicine.


Meanwhile, they state that although the government and the International Monetary Fund present positive facts regarding financial stability, a positive primary account balance, and budget deficit management, those statistics do not reflect the daily living conditions of the public.


Stating that the government has achieved fiscal stability by increasing indirect taxes including Value Added Tax and limiting public expenditure, the 'Dinana Dakuna' collective points out that this tax burden has severely impacted the real income of the people.


The collective stresses that the government must ease the tax burden imposed on essential consumer goods and production inputs, reduce production costs for small and medium-scale enterprises, and provide targeted relief regarding household indebtedness and food security.


The collective further adds that the economic health of a nation should be measured not only by meeting fiscal targets, but also on the basis of real wage growth, poverty reduction, and the restoration of the actual purchasing power of the people.


Emphasising that documented economic stability cannot be sustained without genuine purchasing power among the public, the collective underscores that it is the responsibility of the government to build an economic framework that ensures a fair and dignified standard of living for working people.



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