IMF Officials Reach Sri Lanka For Next Review Of Economic Reform Programme

The new National People’s Power (NPP) government called for a snap parliamentary election that happened last week and this added on to the delay in the review process

The review will evaluate if Sri Lanka has been successful in completing programme targets like state revenue and building reserves.

Source : United Nations

The International Monetary Fund team arrived in Sri Lanka on Sunday to conduct the third review of almost $3 billion bailout facility, officials said. The review is the next step before the fourth tranche of the 4-year facility.

The officials from the country’s Finance Ministry noted that the next tranche will be nearly $330 million similar to the earlier three tranches, reported PTI. The economic reform programme in Sri Lanka is backed by the IMF’s Extended Fund Facility (EFF).

The review was placed on hold till the completion of the presidential election held in September. Further, the new National People’s Power (NPP) government called for a snap parliamentary election that happened last week and this also added on to the delay in the review process.

The review will mark the first interaction between NPP and IMF officials. The review will evaluate if Sri Lanka has been successful in completing programme targets like state revenue and building reserves.

The report noted that the country is yet to officially ink the debt restructuring agreements finalised in the last week of the earlier Wickremesinghe presidency. Last week, the NPP registered a record-breaking landslide victory as Anura Kumara Dissanayake became the new President of the country.

The country approached the IMF for a facility as it suffered a severe economic crisis under the presidency of Gotabaya Rajapaksa, who fled the country after public protests that lasted for several months.

Sri Lanka announced its maiden debt default near mid-April in 2022. The negotiations with the global lender began after the former government under Wickremesinghe secured the bailout in the following year in March. Till the financial assistance, the country was depending on a $4 billion Indian credit line to pay for fuel and essential services.