IMF hails Sri Lanka’s strong program performance

Saturday, 18 May 2024 01:26 - - {{hitsCtrl.values.hits}}

Next steps on debt restructuring are to conclude negotiations with external private creditors
Says official creditors side agreements in principle still need to be finalised

IMF Communications Department Director Julie Kozack

International Monetary Fund (IMF) Communications Department Director Julie Kozack on Thursday said overall program performance in Sri Lanka has been strong.

“With respect to Sri Lanka’s economic performance, macroeconomic policies in Sri Lanka are starting to bear fruit,” she said.

According to her, commendable outcomes include; a rapid decline in inflation, robust reserve accumulation and initial signs of economic growth, while also preserving stability in the financial system.

IMF staff and the Sri Lankan authorities have reached staff-level agreement on economic policies to conclude the second review of the 4-year EFF-supported program and the 2024 Article IV Consultation. Once the review is approved by IMF Management and completed by the IMF Executive Board, Sri Lanka will have access to about $ 337 million in financing.

She said the next steps with respect to the debt restructuring are to conclude negotiations with external private creditors and to implement the agreements in principle with Sri Lanka’s official creditors.

“The initial debt restructuring negotiations with external bondholders ended in mid-April without an agreement and discussions are continuing with a view to reaching agreement in principle. On the official creditors’ side, these agreements in principle still need to be finalised,” said Kozack.

She also said the domestic debt operations are largely completed.

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