Colombo

Sri Lanka has declared an economic emergency after a steep fall in the value of the country's currency caused a spike in food prices.

Authorities say they will take control of the supply of basic food items, including rice and sugar, and set prices in an attempt to control rising inflation, the BBC reported.

The Sri Lankan rupee has fallen by 7.5% against the US dollar this year.

The government has appointed a former army general as c"Cmmissioner of essential services, who will have the power to seize food stocks held by traders and retailers and regulate their prices.".

The emergency move followed sharp price rises for sugar, rice, onions and potatoes, while long queues have formed outside stores because of shortages of milk powder, kerosene oil and cooking gas.

In recent weeks, the prices of most essential goods have been skyrocketing due to the falling local currency and high global market prices driven by the COVID-19 pandemic.

The Central Bank of Sri Lanka recently increased interest rates in a bid to shore up the local currency.

Sri Lanka, a net importer of food and other commodities, is witnessing a surge in COVID-19 cases and deaths which has hit tourism, one of its main foreign currency earners.

Currently, Sri Lanka is under a 16-day curfew because of a jump in Covid-19 cases.

The financial crisis in the once prosperous island nation had started with reports of widespread corruption in the top echelons and the country falling in debt trap to China.