Colombo, Sri Lanka – The International Monetary Fund (IMF) has expressed its satisfaction with Sri Lanka’s ongoing economic reform efforts, reaffirming its commitment to supporting the country’s recovery and long-term economic growth. In a statement to the financial community, IMF Managing Director Kristalina Georgieva praised Sri Lanka’s authorities for their determination to continue their reform agenda, focusing on sustainable growth and economic stability.
Georgieva emphasized the importance of continued support from international financial institutions, official creditors, and bondholders to ensure that Sri Lanka’s reform efforts remain on track. She highlighted that the participation of bondholders in debt swaps, in line with debt sustainability goals, will be crucial to the success of the reforms.
Under the IMF’s guidance, Sri Lanka has implemented a comprehensive economic reform program aimed at restoring debt sustainability, improving macroeconomic stability, and enhancing governance and transparency. The country’s reform efforts are supported by a 48-month Extended Fund Facility (EFF), which was approved by the IMF’s Executive Board in March 2023. The program, valued at approximately $3 billion (SDR 2.286 billion), has already seen positive results, including economic recovery, low inflation, and rising reserves.
As of November 23, 2024, the IMF completed its second review of the program and reached a staff-level agreement with Sri Lankan authorities for the third review. In June 2024, Sri Lanka also signed a Memorandum of Understanding with the Committee of Official Creditors and secured a debt relief agreement with China’s EXIM Bank, which aligns with the debt sustainability goals outlined in the IMF program.
The IMF’s positive assessment underscores the progress Sri Lanka has made in addressing its economic challenges, while also signaling the importance of ongoing international cooperation to ensure the success of the country’s ambitious reform agenda.
