Following the Executive Board discussion on Sri Lanka, IMF Managing Director Kristalina Georgieva said that Sri Lanka should stay committed to the multi-pronged disinflation strategy to safeguard the credibility of its inflation targeting regime.
“Sri Lanka has been facing tremendous economic and social challenges with a severe recession amid high inflation, depleted reserves, an unsustainable public debt, and heightened financial sector vulnerabilities. Institutions and governance frameworks require deep reforms. For Sri Lanka to overcome the crisis, swift and timely implementation of the EFF-supported program with strong ownership for the reforms is critical."
“Ambitious revenue-based fiscal consolidation is necessary for restoring fiscal and debt sustainability while protecting the poor and vulnerable. In this regard, the momentum of ongoing progressive tax reforms should be maintained, and social safety nets should be strengthened and better targeted to the poor. For the fiscal adjustments to be successful, sustained fiscal institutional reforms on tax administration, public financial and expenditure management, and energy pricing are critical."
“Having obtained specific and credible financing assurances from major official bilateral creditors, it is now important for the authorities and creditors make swift progress towards restoring debt sustainability consistent with the IMF-supported program. The authorities’ commitments to transparently achieve a debt resolution, consistent with the program parameters and equitable burden sharing among creditors in a timely fashion, are welcome."
“Sri Lanka should stay committed to the multi-pronged disinflation strategy to safeguard the credibility of its inflation targeting regime. As the market regains confidence, the authorities’ recent introduction of greater exchange rate flexibility will help to rebuild the reserve buffer."
“Maintaining a sound and adequately capitalized banking system is important. Implementing a bank recapitalization plan and strengthening financial supervision and crisis management framework are crucial to ensure financial sector stability."
“The ongoing efforts to tackle corruption should continue, including revamping anti-corruption legislation. A more comprehensive anti-corruption reform agenda should be guided by the ongoing IMF governance diagnostic mission that conducts an assessment of Sri Lanka’s anti-corruption and governance framework. The authorities should step up growth-enhancing structural reforms with technical assistance support from development partners," she said in a statement.
Ranjith Perea Tuesday, 21 March 2023 12:09 AM
The IMF option is timely which ensue a lot sacrifices and hardships to masses of this land to the extend of a large segment of our people go hungry daily and denying their basic necessities with enormous social cost to themselves.Public has no faith in this agreement as it is negotiated and now will have to implement by the same people who are discredited in the eye of masses and most of them themselves are held responsible by masses for this pathetic situation that they are under going currently Given this situation with public resistance it is a million dollar question can we implement this IMF agreement on the top of government with corrupt and discredited politicians who are connected with interlocking self interests popularly know in this land deal politics
Fun Life Tuesday, 21 March 2023 03:24 AM
Certainly, all the said criteria cannot be satisfied with the Rajapaksha's involvement in politics. They (SLPP) want to have FUN LIFE.
Jaffna Logic Tuesday, 21 March 2023 03:52 AM
Historically why was the IMF and the World Bank setup in the first place ? Only gullible fools would believe it was to help the first world countries in financial troubles. The actual unspoken purpose for the setup was to control the third world countries from the outside as they no longer have controlling from the inside as the third world is no more their physical possession to play with. For the third world taking assistance from the IMF or the World Bank is analogous to biting the bait, and Sri Lanka has just bitten it.
Economist Tuesday, 21 March 2023 07:35 AM
The basic problem is ETHNIC DIVISION AND 75% of the armed forces stationed in the North and East. What we need is two states in one country. The IMF should pay attention to this aspect of problem in SL.
Anura Jayantha Tuesday, 21 March 2023 07:53 AM
Who will be taken to task if the IMF program is not complied with? Please do not hold it against the people of Sri Lanka. Send the leaders who fail to abide by your conditions to a special court in the Hague where they will get the right treatment.
Iwazaru Tuesday, 21 March 2023 08:04 AM
This needs to be read by the GMOA who stopped their trade union action on a promise. Nothing in the IMF can not be changed by the Sri Lanka Government.
Jude Tuesday, 21 March 2023 08:48 AM
Generally you lend money to someone with a good track record!! But for the last 75 years SL economy going from bad to worse!! IMF GONNA learn the hard way, YEAH in couple years time SL gov't gonna ask IMF for 25 years Moratorium!!! RANIL GONNA spend other government revenue to Buy some MP's support to win him the next Presidential election, Yeah!!
Jude Tuesday, 21 March 2023 08:51 AM
Moreover, IMF asking SL government to vote against Russia at the next UN resolution!! Yeah!!
Jef Tuesday, 21 March 2023 09:26 AM
Hope the 2.9 billion spend in a way for recovery process genuinely with every single cent been taken in to accountability The money shouldn't be used for parliamentarian politicians officials maintaining wages etc etc country need to recover and accumulate wealth accordingly if not the ship will sink without rescue or surport given from our partners for very long period sri Lanka need a system change to stop all unwanted activities that have put this nation in a huge mess
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