Colombo, Oct 4 (PTI) Sri Lanka will receive the second tranche of the IMF bailout package of USD 330 million after discussions on some pending financial matters between the cash-strapped island nation and the global lender are complete, State Minister for Finance Shehan Semasinghe said on Wednesday.
Responding to questions from the main opposition leader Sajith Premdasa, who has been critical of the government's handling of the International Monetary Fund (IMF) programme, in Parliament, Semasinghe blamed politically motivated cases for stalling the programme of the global lender.
"The second tranche of the IMF bailout would be made available soon and there was no danger of it being halted," he said.
Sri Lanka was hit by its worst economic crisis in history when the country's foreign exchange reserves fell to a critical low and the public came out on the streets to protest the shortage of fuel, fertilisers and essential commodities.
The IMF in March this year approved a 48-month, USD 2.9 billion extended arrangement under the Extended Fund Facility (EFF) to support Sri Lanka’s economic policies and reforms.
The IMF mission that visited Sri Lanka for the first review of the global lender-supported Extended Fund Facility programme for the country noted that despite early signs of stabilisation, full economic recovery is not yet assured.
Sri Lanka was banking on the release of the second tranche of around USD 330 million at the end of the review. However, the IMF referred to Sri Lanka’s failure to meet some of the targets including the anticipated level of state revenue.
Semasinghe said the reason for the shortfall in revenue targets was the legal amendments required to the Central Bank Act and the amendments to the inland revenue needed parliamentary approval.
Semasinghe blamed politically motivated cases for stalling the IMF programme as political opposition groups resorted to legal action on the amendments.
“It was to disrupt the IMF programme and to delay it as much as possible,” he said.
The staff-level discussions are ongoing and the outcome will be submitted to Parliament.
Semasinghe said that the date of the second tranche can be announced after these talks are concluded.
The IMF in its governance diagnostic report issued after its review conducted in Colombo has called for stringent anti-corruption measures with recommendations to be implemented.