Colombo, Nov 23 (PTI) Sri Lanka’s new NPP government on Saturday got the International Monetary Fund (IMF) approval for a staff-level agreement to secure the fourth tranche of the nearly USD 3 billion bailout facility.
“Once the review is approved by the IMF management and completed by the IMF executive board, Sri Lanka will have access to about USD 333 million,” a statement issued by the international money lender here at the end of the third review said.
The previous Ranil Wickremesinghe administration entered the IMF bailout in March 2023 at the height of the island’s economic bankruptcy.
However, in the run-up to the September presidential election at which Wickremesinghe was defeated, the National People’s Power (NPP) and incumbent President Anura Kumara Dissanayake were critical of the bailout, especially its rigid reforms which made the 75-year-old president unpopular.
After forming the government, they have assured the continuation of the programme. “The new government’s commitment to the programme’s objectives has enhanced confidence and ensures policy continuity,” the IMF said.
The IMF stressed that Sri Lanka’s reform agenda was delivering results. “The economy expanded on average by four per cent in the four quarters ending June 2024,” the Washington-based money lender said.
The IMF said Sri Lanka reaching an agreement with private bondholders has put debt on a path of sustainability.
“The new government’s mandate will reinvigorate governance reforms addressing corruption risks, rebuilding economic confidence and making growth more robust and inclusive,” the IMF said.
Sri Lanka’s economic reform programme is supported by the IMF's Extended Fund Facility.
A few days ago, Dissanayake met the IMF’s Sri Lanka mission chief Peter Breuer and the delegation. He urged the IMF team to consider the economic hardships faced by the people and strike a balance in the economic recovery programme.