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Sri Lanka seeks IMF bailout via EFF or RFF at a time of public unrest

 After declaring pre-emptive debt default  Cash strapped Sri Lanka  has sought  an International Monetary Fund bailout by way of Extended Fund Facility(EFF)  or Rapid Finance Facility (RFF) , to battle record inflation and  tackle balance of payment issues.

Minister of Finance Ali Sabry who was appointed several weeks before the IMF spring meetings in the wake of unprecedented public uprising against the mismanagement of the economy and in efficient and corrupt governance said that his talks with the IMF Chief on Monday was very positive.

Minister of Finance Ali Sabry had met with IMF Managing Director Kristalina Georgieva on 18th April at IMF Headquarters in Washington DC.

The IMF has commended the steps already taken by the Finance Minister to mitigate the situation, and assured fullest support by the IMF which was also positive on expediting the processes, Finance Ministry announced. 

However the government has point blankly rejected these two possible financing facilities refusing to make asny official request from the IMF amidst demandes of the country’s leading economic experts and advisors during the past two years. 

International media quoted Finance Ministry as saying that that negotiations between a delegation led by Finance Minister Ali Sabry and the IMF started in Washington on a positive note On Monday 18.

 The IMF has noted the recent steps taken to increase the interest rates and calling for RfP’s for the appointment of international financial/legal advisors as good first steps towards a possible restructuring programme.

The Finance Minister had made a request for a Rapid Financing Instrument (RFI) to mitigate the current supply chain issues.However, initially the IMF was of the view that it doesn’t meet their criteria.

The Finance Ministry said that India subsequently made representations on an RFI for Sri Lanka as well and the IMF may consider this request due to the unique circumstances.

The IMF also appears to be positive towards granting an Extended Fund Facility (EFF), the Finance Ministry said, adding that this can help stabilize things in the short term till long-term solutions kick in.

 The South Asia nation is in the brink of its worst economic crisis since independence from Britain in 1948 with long queues forming outside gas stations and rolling daily blackouts imposed across the country.

 A huge crowd stormed the presidential secretariat in Colombo and occupying Galle Face green for the 12 th day today Wednesday 20  over runaway prices with the rising cost of food, medicine and other essential goods causing serious hardship for Sri Lanka’s 22-million people.

Widespread street protests with the participation of massive crowds have now become the order of the day making the government headed by President Gotabaya Rajapaksa to use minimum police power to disperse aggrieved people who took to the street to demand fuel , coking gas  and some thing to eat, 

In one of the  incident of police using minimum power of  tearagasing,manhandling batoning and shooting at angry protestors   reported on Yesterday at least 24 injured people injured and one person killed in  the Rambukkana protest , eye witnesses said.

 Soon after the tragedy  Ambassador of the United States to Sri Lanka, Julie Chung  issued a statement  demanding a full transparent investigation into the police shooting, which claimed the life of one individual following a tense situation during a protest staged in Rambukkana, eye witnesses said. 

 The Resident Coordinator of the United Nations (UN) in Sri Lanka, Hanaa Singer-Hamdy has raised deep concerns over the casualties reported during the protest in Rambukkana.In this backdrop Sri Lanka delegation Finance Minister Ali Sabri,a lawyer turned politician is engaged in a gigantic task of persuading the  IMF approve this financing facility and the days are numbered for the gaining of donor assistance under the present public unrest, several political analysts said

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