The World Bank has assured it will work closely with the International Monetary Fund and other development partners, to support Sri Lanka’s recovery and sustainable growth.
The assurance was given by World Bank Vice President South Asia Martin Raiser during a brief meeting with State Finance Minister Shehan Semasinghe on the sidelines of the IMF and the World Bank annual meetings taking place in Washington, D.C.
A statement issued by the Finance Ministry noted that State Minister Semasinghe had an insightful conversation on options available to recover Sri Lanka’s economy with the World Bank Vice President for the South Asia Region Raiser and World Bank delegation.
The State Minister also added the new concessional funding requested by Sri Lanka would remain linked to reforms, the progress of debt restructuring, and the program agreed with the IMF.
The discussions also focused on the current creditworthiness of Sri Lanka, which is no longer entitled to source funding through the World Bank’s International Bank for Reconstruction and Development (IBRD).
The process will entail a ‘reverse graduation’ to International Development Association (IDA), which will move Sri Lanka from an IBRD-only country to an IDA country. However Sri Lanka will remain listed as a middle-income country, the statement added.
As per the World Bank Vice President South Asia, sustained improvements in economic and social conditions by the Government could pave the way for Sri Lanka to graduate from IDA in the future.
State Minister Semasinghe is heading the Sri Lankan delegation attending IMF and World Bank annual meetings in Washington, D.C.
The World Bank’s Vice President South Asia said that it would extend further support after reaching an agreement with the International Monetary Fund.
This was stated at a discussion between World Bank representatives and State Minister Semasinghe in Washington.
There are 17 ongoing World Bank-funded projects in Sri Lanka. The World Bank’s, said that the projects were being redesigned to provide financial assistance to meet the current crisis.
Explaining the current situation in the country, the minister pointed out the need to provide the World Bank loan assistance to banks and financial institutions.
He requested the WB representatives to take necessary measures to issue such financial assistance at low interest rates to the people engaged in agriculture, livestock, small and medium scale enterprises and businesses.
Representatives of the World Bank said that they have already decided to allocate funds for domestic gas and fertilizer supplies.
Tax increases, the removal of diesel and kerosene subsidies will have a severe impact on many sectors including fisheries.
The government is also concerned about other groups at risk. He said that these issues would have to be considered in reaching an agreement with the International Monetary Fund (IMF).
