April 05, Colombo (LNW): The International Monetary Fund (IMF) expressed optimism on Thursday regarding Sri Lanka’s ongoing negotiations with its commercial creditors, anticipating a resolution by the completion of the IMF’s second review.
Sri Lanka is currently engaged in discussions with bondholders to restructure approximately USD 12 billion in debt, a crucial step in its efforts to navigate through a challenging financial crisis.
IMF spokesperson Julie Kozack stated during a press briefing that there is a “strong expectation” for agreements to be reached with commercial creditors in line with program parameters by the conclusion of the second review.
Although the IMF had reached a staff-level agreement with Sri Lanka on the second review of its four-year bailout program at the end of last month, formal approval from the IMF’s board is still pending.
Kozack also highlighted the positive impact of macroeconomic policy reforms in Sri Lanka, noting achievements such as rapid disinflation, robust reserve accumulation, and initial indications of economic growth, all while maintaining stability in the financial system.
Despite these commendable outcomes, challenges persist in Sri Lanka’s public finances, underscoring the importance of ongoing efforts to address and mitigate the country’s economic difficulties.
