Sri Lanka plans to enter into an agreement with the World Bank for $500 million in budgetary support after the Cabinet approved it on Tuesday, Reuters reported.
This is the biggest funding tranche for Sri Lanka since an International Monetary Fund (IMF) deal in March.
Sri Lanka with a population of 22 million is emerging out of its worst economic crisis in seven decades and its economy is expected to shrink 2% this year before returning to growth next year, following last year’s record contraction of 7.8%.
Last week it was reported that the World Bank was likely to approve $700 million in budgetary and welfare support for Sri Lanka.
Reuters reported that the budgetary and welfare support was likely to be approved at the World Bank’s board meeting on June 28.
According to the report, from the $700 million in budgetary and welfare support $200 million will be for welfare programmes.
The government said on Tuesday (26) that funding from the lender will come in two tranches. (NewsWire)