World Bank grants $ 400 m loan after Govt. appeal: Ravi

• Total loan facility adds up to $ 1.3 b for three years
• Describes loans as a “great achievement” by Govt. and sign of fiscal consolidation  

The World Bank yesterday granted a $ 400 million International Development Assistance (IDA) loan facility, despite Sri Lanka being ineligible as a middle-income country, following appeals by the Government, Finance Minister Ravi Karunanayake said. 

“As we graduated from low-income category to middle-income country, we lost the International IDA loan scheme where the interest rates are at the lower rate. However we would have been at a very difficult situation if we didn’t receive the facility. We made an appeal, and through the appeal we were able to gain their understanding... where they have given us the IDA facility as well as the World Bank facility,” Karunanayake said.

Accordingly, the country will be receiving an additional $ 400 million under IDA facility at a lower interest rate, along with $ 900 million through the International Bank for Reconstruction and Development (IBRD) loan scheme under the World Bank at customary rates. The total loan facility adds up to $ 1340 million for three years, the Minister said.  

Calling the move a “great achievement” on the part of the Government, the minister viewed the decision by the World Bank as, “an endorsement for the financial discipline and fiscal consolidation,” displayed by the current administration. 

“Everyone understands the debt burden that has been inherited by this Government and are supportive of our endeavours,” he said.