Another IMF programme already on the cards upon completion of ongoing one

28 March 2023 04:04 am - 7 - {{hitsCtrl.values.hits}}

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This would be to support continuation of reforms, says former CB Governor Dr. Indrajit Coomaraswamy
JB Securities MD Murtaza Jaffejee says SL might have to renegotiate a new programme with IMF as country is unlikely to meet ambitious targets
However, Advisor to FinMin Deshal de Mel cautiously optimistic on prospects of completing current IMF programme by meeting targets

By Nishel Fernando
Sri Lanka is likely to go for another International Monetary Fund (IMF) programme after the end of the current four-year programme, to continue with the structural and institutional reforms.

“I think there will be another programme definitely but it will be to support the continuation of reforms, not to support another debt restructuring,” former Central Bank Governor and senior economist Dr. Indrajit Coomaraswamy told a virtual forum organised by the Central Bank.

Meanwhile, JB Securities Managing Director Murtaza Jafferjee opined that the country is unlikely to meet the ambitious targets under the current IMF programme and therefore, it is likely to renegotiate a new programme.
“It’s highly likely that we won’t be able to complete the programme. The reason I’m saying that is, not due to the lack of tax policy but because it will take few years for the economy to recover.

Even if you work on it really hard, it will take at least three years; then you have to give sometime to take it into effect. We will have a bounce back but it will take many years for the economy to grow. Therefore, I’m not optimistic that the recovery will be very strong and very fast,” he said.

Having said that, Jafferjee outlined the reforms would lay the foundation for a new beginning for the economy.
However, Economic Advisor to Finance Ministry Deshal de Mel was cautiously optimistic on the prospects of completing the IMF programme by meeting the targets, including delivering the primary surplus of 2.3 percent of GDP by 2025, from the negative 5.6 percent in 2021.

“It’s ambitious, going from 5.6 percent in 2021 but we are also starting from a low base. The 14 percent revenue target is not particularly high. It’s not an unrealistic target; the way to go is to address through core taxes. Robust structure in these taxes should do the heavy lifting,” he said.

He also stressed that it is paramount to meet these targets, in order to rebuild the confidence of the international market.

“If we miss this chance, it will be difficult to regain the confidence of the international market and community,” de Mel added.

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Comments - 7

RW Tuesday, 28 March 2023 07:05 AM

I am very proud of you . Already planning for the next loan 4 yrs in advance. Thank you for keeping all under debt forever.

Jagath Ekanayake Tuesday, 28 March 2023 09:18 AM

Begging for loans is not a great achievement by any means. But I guess we can't expect anything more from these bunch of morons.

Jude Tuesday, 28 March 2023 09:22 AM

Well, biggest downside of IMF bailout money is countries becoming eternally Dependant of bailouts, yeah!!

Truth Tuesday, 28 March 2023 01:53 PM

Understood. We need another loan to settle the present loan. Got to plan in advance.

Tissa Fernando Tuesday, 28 March 2023 04:39 PM

We will eat well with this money received and party till dawn and travel in luxury cars. Some of those will even record YouTube videos of every restaurant they go and everything they eat. Once we finish this IMF money and expat remittances, we will ask for more money from IMF. We will ensure that our lazy government servants get fat salary by collecting taxes too. Once in a way we will sell our property and factories to foreign investors . That is how we have been and will be.

Ranga Tuesday, 28 March 2023 05:39 PM

We shouldn't blame IMF for our own issues

Cannot get it up with so many lousey big earners here Tuesday, 28 March 2023 07:13 PM

Only Sri Lankan's being paid by government such as Coomaraswamy and Deshal de Mel would spout rubbish believing anything will succeed here. The majority of tax payers, even if less than 5% of the country would definitely rather ruin the country than pay tax. Government cannot use Army to break the 100,000 plus earning people like it can the poor, so government will be broken. Helping the 80% of the population is vital, but the 100,000 plus earners would rather that those starve so their lousy selves can get away with no tax.

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Another IMF programme already on the cards upon completion of ongoing one

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