February 18, Colombo (LNW): The Executive Board of the International Monetary Fund (IMF) is set to convene on February 28, 2025 to review and approve the third assessment of Sri Lanka’s Extended Fund Facility (EFF) programme.
This meeting will be a crucial step in securing further financial support for the country, with the IMF staff having reached a staff-level agreement with Sri Lankan authorities on November 23, 2024. If approved, Sri Lanka will gain access to approximately US$ 333 million in additional funding.
Previously, the IMF had made it clear that the disbursement of the fourth tranche of the EFF programme hinged on the approval of the IMF’s Executive Board, which in turn was dependent on the fulfilment of specific conditions by the Sri Lankan authorities.
Amongst these conditions was the submission of the 2025 Budget, which must align with the parameters set forth under the terms of the EFF.
During a press briefing on 6th February 2025, IMF Spokesperson Julie Kozack commended Sri Lanka for the progress made in its ambitious reform agenda. She highlighted that the economy had grown by 5.5 per cent in the fourth quarter of 2024, demonstrating resilience despite the ongoing challenges.
Additionally, she noted that inflation had remained well within target, and the country’s international reserves had risen to US$ 6.1 billion by the end of 2024, marking a positive shift in Sri Lanka’s economic stability.
In response to queries about Sri Lanka’s 2025 Budget, Kozack reiterated that while the staff-level agreement had been reached in November, the approval of the third review by the IMF’s Executive Board was contingent upon the successful implementation of certain prior actions.
These actions include the submission of a 2025 budget that aligns with the agreed-upon parameters of the programme.
The timing of the IMF’s Executive Board meeting closely follows a significant event in Sri Lankan politics—the presentation of the 79th Budget Speech of Independent Sri Lanka by President Anura Kumara Dissanayake on February 17.
This is Dissanayake’s first full budget since taking office, marking an important milestone in Sri Lanka’s fiscal planning and its ongoing collaboration with the IMF.
