Home » IMF and Sri Lanka discuss measures of finding foreign funds

IMF and Sri Lanka discuss measures of finding foreign funds

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The deepening economic crisis is forcing the government to make immediate choices between seeking short term funding at concessionary rates or as grants from international agencies and donor countries.

The International Federation of Red Cross and Red Crescent Societies (IFRC) has made an Emergency Appeal for urgent humanitarian assistance for 28 million Swiss francs in support of Sri Lanka Red Cross.

In line with the IFRC appeal, the International Committee of the Red Cross (ICRC) supports the Sri Lanka Red Cross to respond to the humanitarian issues arising from the economic crisis with a focus on providing medical equipment to the healthcare system and economic assistance to vulnerable people.

According to Foreign Minister Ali Sabri , the man-made economic crisis was ignored by the then cabinet of previous Gotabaya Rajapaksa regime due to their lack of knowledge.

Under this set up the country is compelled to extend its begging bowl for foreign funding with an urgent appeal to the World Bank to down grade Sri Lanka as low income country temporary.

The International Monetary Fund (IMF) and Sri Lanka had further discussions on the steps Sri Lanka must take to obtain approval for the proposed Extended Fund Facility (EFF) programme.

The Sri Lankan delegation to the IMF/World Bank Annual Meetings 2022 led by the State Minister of Finance Shehan Semasinghe, had a fruitful discussion with the Deputy Managing Director of the IMF, Kenji Okamura, IMF sources said.

The delegation extensively discussed with the IMF team Sri Lanka’s recent economic trends and the next steps required to obtain the IMF Executive Board approval for the proposed Extended Fund Facility (EFF) programme.

Dr. Chandranath Amarasekara, Alternate Executive Director of the IMF, Dr. Nandalal Weerasinghe, Governor of the Central Bank of Sri Lanka and Mahinda Siriwardana, Secretary to the Treasury also attended the talks.

The IMF had reiterated last week the prior actions Sri Lanka must take for the IMF board to approve the disbursement of funds.

Deputy Director, Asia and Pacific Department at the International Monetary Fund, Anne-Marie Gulde, had said that the conditions involve securing assurances from bilateral creditors and dealing with the private sector debt.

“Sri Lanka is facing a very severe economic crisis. And let me start by saying that we are very concerned about what’s going on in Sri Lanka.

And we all hope that we will be able to work very fast to end the suffering, especially the suffering of the poor and vulnerable. We have reached a staff level agreement on a four-year EFF program on September 1 of this year,” Anne-Marie Gulde said.

She said that the initial disbursement of the program will only come after the IMF board meeting.

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