October 04, Colombo (LNW): Sri Lanka’s economic revival continues to gain international recognition, with the International Monetary Fund (IMF) commending the island nation for the steady progress achieved under its ongoing reform agenda.
The positive assessment comes as the country moves further along its path of post-crisis recovery, supported by the IMF’s Extended Fund Facility (EFF) programme.
Addressing journalists in Washington on October 02, IMF Communications Director Julie Kozack highlighted Sri Lanka’s improving economic indicators, noting that the country has maintained low inflation levels, strengthened its foreign reserves, and significantly improved its revenue performance.
“The recovery has been quite robust,” Kozack observed, pointing out that the economy recorded a 5% growth rate in 2024, marking a notable turnaround after a period of severe financial turbulence. “Government revenue as a share of GDP rose to 13.5 per cent, up from just 8.2 per cent two years ago. While there’s still more to be done, this represents a remarkable step forward,” she added.
Kozack also reported that Sri Lanka’s debt restructuring efforts are nearing completion—a critical element of the broader recovery strategy. Successful restructuring has been essential to easing the country’s debt burden and restoring confidence among international creditors.
The IMF has so far disbursed a total of US$1.74 billion to Sri Lanka under the EFF agreement, with the latest tranche of US$350 million released following the completion of the programme’s Fourth Review in July this year.
An IMF delegation is currently in Sri Lanka conducting the Fifth Review, with discussions underway between the mission team and local authorities. While further details are expected at the conclusion of the mission, Kozack confirmed that overall programme performance remains strong.
She emphasised that the Sri Lankan government continues to demonstrate clear commitment to the reform agenda, which is centred on restoring macroeconomic stability, achieving debt sustainability, and implementing structural reforms aimed at fostering long-term growth.
International observers have increasingly cited Sri Lanka’s reform trajectory as a potential model for other countries facing similar economic challenges. The government’s efforts to improve fiscal discipline, modernise state institutions, and stabilise its financial system have helped to regain a measure of investor confidence and set the foundation for more inclusive and sustainable development.
