Sri Lanka expects IMF staff-level agreement Friday
Sri Lanka is set to secure a staff-level agreement with the International Monetary Fund (IMF) on Friday for the third review of its $2.9 billion bailout program, President Anura Kumara Dissanayake announced during the inaugural session of the new parliament.
Upon IMF executive board approval, Sri Lanka is expected to receive a further tranche of approximately $337 million, providing much-needed financial support to the struggling economy.
A delegation from the IMF is currently in Colombo to conduct the review and plans to address the media in a briefing on Saturday. Meanwhile, President Dissanayake has outlined plans to finalize a $12.5 billion debt restructuring with bondholders by December.
In addition, the country aims to negotiate individual agreements with key bilateral creditors, including Japan, China, and India, to complete a separate $10 billion debt restructuring.
'Our economy is on a precarious footing, unable to withstand further shocks. We must carefully evaluate every policy decision. Since taking office, our priority has been to restore confidence and reassure stakeholders,' Dissanayake told parliamentarians.
The president’s Marxist-oriented National People's Power (NPP) coalition recently achieved a historic victory in the general election, securing 159 out of 225 parliamentary seats.
Sri Lanka’s economic crisis, triggered by a severe foreign currency shortage in 2022, led to a sovereign default and a sharp contraction of its economy, which shrank by 7.3% in 2022 and a further 2.3% in 2023.
However, the country is now poised for recovery, with the World Bank projecting a growth rate of 4.4% in 2024—its first positive growth in three years.
.png "Advertisement")
