Sri Lankas brand-new federal government has consented to push ahead with a IMF bailout programme that includes difficult austerity and financial reforms, the worldwide loan provider announced on Saturday (Nov 23).
The International Monetary Fund stated it reached an agreement with President Anura Kumara Dissanayakes administration to continue with the four-year loan negotiated by his predecessor last year.The authorities have actually dedicated to stay within the guardrails of the program, IMF team leader Peter Breuer told press reporters at the end of talks with the new government.He said the brand-new governments commitment ensured policy continuity.Sustaining the reform momentum is vital to securing the hard-won gains of the programme, and putting the economy on a course towards lasting recovery and steady and inclusive development, Breuer added.Sri Lanka went to the IMF for a rescue plan after the country defaulted on its US$ 46 billion external financial obligation in April 2022 throughout an extraordinary economic meltdown.The shortage of forex, which left the country unable to fund even the most vital imports of food and fuel, resulted in months of street protests and required then-president Gotabaya Rajapaksa to resign.The US$ 2.9 billion loan protected early last year required Colombo to sharply raise taxes, remove generous energy aids and consent to reorganize more than 50 loss-making state enterprises.Dissanayakes predecessor Ranil Wickremesinghe protected the rescue that includes the disbursement of a US$ 2.9 billion loan over four years.In his very first address to parliament, after his National Peoples Power celebration won a landslide at the Nov 14 election, Dissanayake backed the IMF offer on Thursday.The discontentment with conventional politicians held responsible for the economic collapse was a key motorist of Dissanayakes electoral success.Dissanayake said there was no room to make any mistakes in handling the economy.According to Breuer, the brand-new governments promise to eliminate corruption will renew governance reforms, reconstruct financial self-confidence, and make growth more robust and inclusive.Sri Lanka will now have the ability to draw down US$ 333 million, based on IMF board approval, by the end of the year.Source: AFP-- Agencies