June 13, Colombo (LNW): The International Monetary Fund (IMF) has greenlit Sri Lanka’s second review within the Extended Fund Facility (EFF) programme, paving the way for the country to access approximately US$ 330 million in its third tranche, confirmed Foreign Minister Ali Sabry.
In a statement on ‘X’, Sabry hailed the approval as a testament to Sri Lanka’s commitment to driving forward economic reforms for the betterment of all Sri Lankans.
Julie Kozack, the Director of the IMF Communications Department, verified that the Article IV Consultation and the second review under the EFF were slated for discussion during the IMF Executive Board meeting on June 12.
During a press briefing on June 6, Kozack expressed confidence that Sri Lanka would soon secure agreements with external commercial creditors in line with programme parameters.
On March 21, an agreement was reached between IMF staff and Sri Lankan authorities on economic policies, marking the conclusion of the second review of the economic reform programme and the 2024 Article IV Consultation.
State Minister of Finance Shehan Semasinghe noted June 12 as a pivotal moment for Sri Lanka’s economy, expressing optimism that international partners would continue to support the nation’s efforts.
He underscored that a favourable outcome from the review is expected to unlock the third tranche, further bolstering confidence in ongoing economic reforms and growth.
Furthermore, the Central Bank of Sri Lanka (CBSL) expressed confidence in the IMF’s approval of the third tranche under the EFF programme, with Assistant Governor Dr. Chandranath Amarasekara stating that they anticipated an announcement from the IMF regarding the release of the tranche.
In a subsequent statement, the IMF disclosed that the Executive Board had completed the second review under the 48-month EFF Arrangement, enabling authorities to draw approximately US$ 336 million.
This brings the total IMF financial support disbursed so far to about US$ 1 billion. Additionally, the Executive Board concluded the 2024 Article IV Consultation with Sri Lanka.
The EFF aims to restore Sri Lanka’s macroeconomic stability and debt sustainability, mitigate the impact on the poor and vulnerable, rebuild external buffers, safeguard financial sector stability, and strengthen governance and growth potential.
Despite signs of economic recovery, vulnerabilities remain, underscoring the need for continued reform efforts.
