Sri Lanka is inching closer to receiving the next installment of much-needed financial support from the International Monetary Fund (IMF), as the fourth official review of its IMF-backed program wrapped up this week. Deputy Minister of Finance Dr. Anil Jayanta Fernando confirmed that the review, which was held in Washington, D.C., has paved the way for a staff-level agreement that will unlock the program’s fifth tranche.
High-level discussions took place between Sri Lankan officials—including Deputy Minister of Finance Dr. Harshana Suriyapperuma, the Secretary to the Ministry of Finance, and the Governor of the Central Bank—and the IMF team. Their goal: to assess Sri Lanka’s progress under the program and agree on next steps.
The IMF noted on Thursday that it’s optimistic about finalizing a staff-level agreement soon. However, recent economic policy changes, particularly around tariffs, added complexity to the negotiations. Krishna Srinivasan, Director of the IMF’s Asia and Pacific Department, explained during a press briefing that these sudden policy moves made it challenging to complete a stable macroeconomic framework. “The team was in Sri Lanka when these tariffs were announced, which made it tough to accurately assess their impact on growth and exports,” he said in response to a question from News 1st journalist Zulfick Farzan.
Despite those hurdles, both sides seem confident that a deal is on the horizon—one that could unlock vital funding and continue stabilizing Sri Lanka’s economy, which has faced considerable headwinds in recent years.
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