The International Monetary Fund (IMF) is expected to announce its decision regarding the third installment of Sri Lanka’s Extended Credit Program after completing a review following a three-day visit to the island. The IMF delegation, led by Krishna Srinivasan, Director of the Asia Pacific Department, engaged in a series of discussions with President Anura Kumara Dissanayake and his team to assess the progress of the country’s economic reforms.
IMF spokesperson Julie Kozak stated that Sri Lanka’s economic performance under the program has shown strong indicators, including renewed economic growth and strengthened foreign reserves. However, she also highlighted that uncertainties remain in key sectors, which require ongoing attention.
The discussions, held at the President’s Office, explored alternative approaches to achieving IMF program goals while alleviating the burden on Sri Lankan citizens. The talks concluded on October 4, 2024, and were described as constructive and positive, fostering a cooperative atmosphere between both parties.
While the Sri Lankan administration expressed a desire to explore modifications to the program, particularly in ways that do not undermine debt sustainability or agreements with bondholders, Kozak emphasized that any adjustments must be aligned with these critical parameters.
The IMF will finalize its decision regarding the third loan installment, which is part of a $2.9 billion Extended Credit Facility, after concluding its review. In the previous evaluation, Sri Lanka was granted immediate access to $336 million in June 2024, following a successful assessment of its reform initiatives.
A formal announcement on the outcome of the third evaluation is expected in the coming weeks.
