IMF Chief Praises Sri Lanka’s Economic Recovery and Pledges Continued Support

IMF chief Kristalina Georgieva praises Sri Lanka’s economic recovery during a virtual meeting with President Dissanayake. She highlights the nation’s remarkable turnaround and reaffirms IMF’s support amidst ongoing reforms. Dissanayake aims to enhance private investment while enacting new legislation and continuing with the IMF’s bailout plan.

The International Monetary Fund (IMF) Managing Director Kristalina Georgieva has expressed her support for Sri Lanka’s economic recovery, praising the nation for its significant progress during talks with President Anura Kumara Dissanayake. Georgieva emphasized the stability of the Sri Lankan economy, stating that it is now performing well and highlights the importance of this recovery for the country’s poorer citizens. She remarked on the remarkable turnaround since the economic crisis that led to a near-collapse of the nation’s economy.

Sri Lanka secured a $2.9 billion bailout from the IMF in 2023, following its first sovereign default in April 2022 due to severe economic turmoil and a shortage of foreign exchange. President Dissanayake, who assumed office in September, had initially promised to negotiate the IMF loan terms but has continued the previous government’s austerity measures despite their unpopularity. Georgieva highlighted the necessity of taking domestic actions to reinforce the economy amidst global uncertainties, expressing the IMF’s readiness to support Sri Lanka’s journey towards stability.

Dissanayake expressed his intentions to reduce national debt and encourage private investment, stating plans to enact new legislation such as an Investor Protection Act to create a conducive environment for investors. The IMF had previously disbursed $334 million last month, marking the fourth installment of the bailout to facilitate the reform process. The IMF noted that these reforms are yielding positive results, with Sri Lanka’s real GDP recovering approximately 40 percent of its losses from 2018 to 2023.

The IMF has reaffirmed its commitment to support Sri Lanka’s economic recovery, highlighting the nation’s impressive turnaround from a severe economic crisis. With ongoing reforms and new investor legislation being introduced, the Sri Lankan government aims to stabilize debt and attract private investment. The IMF’s assistance is vital as Sri Lanka continues its recovery journey, demonstrating resilience in the face of global economic challenges.

Original Source: www.channelnewsasia.com