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28 November 2022 05:46 am - 26 - {{hitsCtrl.values.hits}}
If Sri Lanka misses the December target, which now appears to be bit of a stretch, the country could still activate the
International Monetary Fund (IMF) rescue package to unlock US$ 2.9 billion over a four-year span as very good progress is being made in the debt restructuring front, particularly with the country’s bilateral lenders.
Speaking to media last week, Central Bank Governor Dr. Nandalal Weerasinghe shrugged off certain reports which claimed that Sri Lanka could not activate the deal till next March if the December target is missed.
“The December target appears a bit optimistic as of now. But if we miss that, we still have time until January,” he said.
Dr. Weerasinghe said that IMF Board meetings happen at least three days a week with many items in their agenda and thus missing the December target is not a big deal.
In a presentation made to creditors in September, the timelines drawn up by the Sri Lankan authorities showed that they expected to receive IMF Board approval for the staff-level agreement reached in early September by mid-December or early January 2023 after obtaining financing assurances from the bilateral creditors by mid-November.
To expedite the process, the authorities are promoting an adhoc bilateral platform for the Paris Club and non-Paris Club creditors to come together to give their financing assurances to the IMF, having debated among themselves.
The majority of Sri Lanka’s bilateral credit is held by the two non-Paris Club countries China and India.
“We are very confident in the way the discussions are going ahead in getting their assurances. So, the IMF can submit the proposal to the Board sooner,”said Dr. Weerasinghe, expecting the assurances to be forthcoming in the next couple of weeks.
Meanwhile, the financing assurances from private creditors would mean Sri Lanka is making a ‘good faith’ effort to reach a collaborative agreement with them which includes engaging in early dialogue and sharing relevant information on a timely basis.
They have formed two creditor committees – one consisting of 100 members of international investors and another consisting of eight local private banks holding slightly in excess of a billion dollars worth ISBs.
Besides obtaining creditor assurances, Sri Lanka also has to make good on some prior actions such as raising taxes, as part of its revenue-based fiscal consolidation efforts, raise interest rates to contain consumption and investments and end monetary financing, allow greater foreign exchange rate flexibility, strengthen Central Bank independence, and embark on reforming state-owned enterprises.
Adwani Monday, 28 November 2022 06:54 AM
Since this Nande is handling CB affairs there are chances of IMF funds reaching into the wrong hands. Majority of the old crooks are hungrily watching the situation to steal forex. From 2019 to 2020 7 Billion Dollars vanished.
Reformist Monday, 28 November 2022 07:00 AM
Last paragraph is the most important. The clowns in Parliament won't understand a thing about them and they are attacking the Governor. This Governor has a backbone and he is sticking to his guns and ignoring the politicians and most importantly, the incompetent previous CB heads and corrupt governments. What I am a bit surprised about is why IMF did not demand for water tight anti corruption laws and bringing all those corrupt officials before the courts.
Ram Monday, 28 November 2022 07:10 AM
In my mind this statement is made to silence all of us giving hope that we will be ok in the near future. From what I know RW is struggling to satisfy the conditions laid by IMF with Rajapaksa opposition. One condition is to investigate the stolen money. RW cannot go further
No Kore tax man Monday, 28 November 2022 07:13 AM
Make SOE reforms and reduce government servants before IMF deal else same mess will repeat in some years due to huge loss of SOEs and huge government expenses on salary and pensions
Jagath Leanage Monday, 28 November 2022 07:26 AM
Governor , please wake up . You are still DREAMING .
L Jaya Monday, 28 November 2022 07:32 AM
The reason for the delay is not spelled out. This could be, I guess as a result lenders not in agreement with the proposed changes. I am sure this will stretch and be delayed further. I the meantime government will continue with all the austerity measures taken so far and any upheavals will be quenched by imposing state of emergency, curfew and deployment of armed forces
Premalal Perera Monday, 28 November 2022 07:34 AM
The world has turned upside down when institutions like the IMF agrees that plunderers of a nation's wealth are exempt from justice while gleefully accepts the innocent victims pay off the debts.
Sam Monday, 28 November 2022 08:20 AM
Distinct lack of credible effort on restructuring state enterprises, all that is being done is increasing tax and bills on the innocent to pay for the corruption and inefficiency in the SOE's.
Mizaru Monday, 28 November 2022 08:31 AM
This man is playing politics to please his hander(s). The IMF bailout is not in the hands of the Sri Lanka Central Bank. It is at the mercy of the IMF, Japan, India and China and not to forget the bond holders. The funds or loans got from Japan, India and China are from their respective citizens.
Suhada Monday, 28 November 2022 08:36 AM
With continuous delays of the IMF approval date and China playing an important role in the debt restructuring pre requisite, it's now high time the president, the cabinette and the central bank governor also shared a potential Plan B if IMF is getting too troublesome to achieve due to China matter. We as citizens have been failed by all of you for 74 years and to re gain our trust improve transparent non political communication with us the citizens.
Dee Monday, 28 November 2022 08:53 AM
Better to have general election before that and form a new government! Because this country is facing 'Economic Armegedon'.
Tissa Fernando Monday, 28 November 2022 09:00 AM
USD 2.9 Billion over 4 years is nothing , it is hardly enough to meet 2 months imports. The cost of getting these money would be tremendous in the long run as their policies are not working in countries like Sri Lanka. The exporters and undial guys are the ultimate beneficiaries who hold their dollars abroad. If exporters do not bring the money back, then find out how they are financing their operations locally. Find out who is operating undial ( cannot be just small guys) with corporation from main expat countries and catch them (they do not catch these guys as these guys are linked to the sri lankan royal families).
Jude Monday, 28 November 2022 09:08 AM
Sri Lanka shouldn't get Even a penny until SL rectify their human Rights situation!! Recently President RANIL made a Dumass comment that won't allow another Aragalaya!! That means dictatorship, taking away people's right for peaceful protests!! This kind of comments and actions doesn't bode well with international agencies!! RANIL Must go on bended knees and beg for money!!
Jude Monday, 28 November 2022 09:28 AM
SL people should suffer more for allowing scumbag like Ranil to run the country!! To begin with, he's not the elected President, due to screwed up constitution, and SL people have become extremely tolerant, yeah!! Back in the 70's or 80's this kind of nonsense would never have taken place!! Yeah during that time politicians lived in fear some them were eliminated, we need that fear put into present day politicians!! We'd a situation the country was living hell, parents unable to Buy milk powder and kids were starving!!and what people did was protesting, Huh and these politicians have seen thousands of protests!! If my kids were starting I would've definitely dispatched couple of politicians for sure,!!
K.L Pathirana Monday, 28 November 2022 09:58 AM
Hopeful is the key word here is being used to avert any embarrassment. Most importantly SL must comply with all IMF requirements and give the assurance that the law and order situation is impartial. Reduction of military spending, equality treatment and accountability should be assured. The money we receive isn't grown on trees, IMF has to assure foreign taxpayer that the money is not wasted or embazzled.
Jude Monday, 28 November 2022 10:15 AM
Missing December target NO BIG deal for Nandalal, of course he's getting Rs.400,000 month salary plus rent Free house, with car and driver unlimited fuel and cell phone bill also paid by CB!! So for Nanda, it's Notta BIG deal, Huh!!
Jude Monday, 28 November 2022 10:21 AM
Hey Nanda, if you get the IMF BAILOUT first tranche in January 2023, I will shave my Head in the public at Galle face !! If you don't get it would you shave your Head??!! Are you man-enough to take up the challenge!!???
Roshan samarathunga Monday, 28 November 2022 11:00 AM
Excellent news these targets needs to be implemented on the parliament to curb calorie intake by over weight crooks. Makes sure to educate the importance healthy living , and inclusive society. Less master debate the unelected president and replace uneducated crooks in the parliament
Sanjeewa A. Monday, 28 November 2022 12:17 PM
As a country, it's very difficult to move forward with millions of state sector workers with more than double the required size. Also there are lots of corruption going on in these departments on a daily basis not allowing to make any profits. For ex, CPC and CEB like govt organizations are making losses every month and ordinary people take the burden of keeping them in business.
Chanaka jayaweera Monday, 28 November 2022 12:21 PM
This person called governer is talking nonsense...these people have only papaer qualification...this country needs people who have different mindset and lots of pratical knoledge who can really help to develop this country...this country is going nowhere...all the best sri lanka...
Eper Monday, 28 November 2022 12:33 PM
Firstly in order to avoid a repetition, our researchers should find the cause of the economic crisis and expose/charge/imprison the culprits.22million poor/innocent citizens of Lanka are suffering as a result.
Punchi Monday, 28 November 2022 12:35 PM
March 2023 will be when a year will have elapsed since our Buddha blessed country went begging to the IMF. I am willing to wager that no money will be received before the date of this inglorious anniversary
Terrence K Monday, 28 November 2022 01:17 PM
@Tissa Fernando it is important to see the bigger picture instead of having a myopic vision. You have rightly said that the amount available through IMF is not sufficient. What our country is facing today is not only the absence of participation of global players but also with local inflows as no one wants to risk their funds with the present regime because they fear that what has happened to the creditors of the past will happen to them. Whilst the IMF by stepping in results in a booster building measure that prospective creditors from outside will have the assurance that some of the bottlenecks will be ironed out and although the path ahead is arduous stringent measures will be implemented by the government with IMF monitoring to ensure that midway we do not wobble and fall into square 1. In every proposition there is a risk. Only when there are professionals with integrity and transparency present could the economy be charted with sustainability without deviation.
Prasath Monday, 28 November 2022 01:35 PM
All the State Owned enterprises have to be privatised and all government servants should join the pvt sector or laid off. Losses made by SOE, salaries, pensions, duty free vehicles, other perks etc etc etc will keep the country bogged down for ever. Any amount of LOANS will be temporary.
Buddhist Monday, 28 November 2022 07:00 PM
China will not agree to a debt haircut as they do not want Americans and Indians to have a grip on Sri Lanka. The best option is to recover the stolen money from the King and his family and settle China for good, then nationalize all Chinese assets in SL.
Roshan Monday, 28 November 2022 08:36 PM
This is easier said than done. I personally don't think that we will get the first tranche of the funds in Jan 2023. There are multilateral and bilateral debts. China is very unlikely to apply a haircut on their debt payments. Instead, they would probably look to extend the term or provide another loan. What if they don't agree? What can Sri Lanka do about it. First, the government should be transparent about what they do. Our debt is so unsustainable and IMF will release their funds only if our debt becomes somewhat sustainable. The current debt to GDP is around 122%. Government revenue is way below than the government expenditure and the interest payment.
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