A team of representatives from the International Monetary Fund (IMF) is scheduled to arrive in Sri Lanka next week to conduct discussions with local authorities on the seventh review of the Extended Fund Facility.

The delegation, led by IMF Mission Chief Evan Papageorgiou, will remain in the country from September 10 to 23, during which they are expected to engage in talks covering recent economic developments, reform policy frameworks, and long‑term strategic challenges.

According to reports, the visit forms part of the IMF’s ongoing programme with Sri Lanka, which includes monitoring progress on reforms and assessing the country’s fiscal and debt management strategies. 

The discussions are also expected to focus on the reform programme tied to the Extended Fund Facility. (Newswire)

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Former Finance Minister Ali Sabry has credited Indian Finance Minister Nirmala Sitharaman with changing the tables during a crucial meeting with International Monetary Fund (IMF) representatives on Sri Lanka’s economic crisis. 

Sharing his views on Impactstories_podcast, Ali Sabry said that during his tenure as Finance Minister, he was tasked with negotiating with the IMF leadership with regard to Sri Lanka’s economic crisis. 

“When I went to Washington, I had a meeting with the regional directors and they were very negative about Sri Lanka. They said 16 times this has happened. I was disappointed. You know, for the first time we are trying to tell different things. They were not willing to listen. I thought they lacked empathy,” he said.

Ali Sabry revealed that he was supposed to meet IMF Managing Director Kristalina Georgieva along with IMF Deputy Managing Director Gita Gopinath at 03.00 pm, before which he met Indian Finance MInister Nirmala Sitharaman. 

“In between this meeting something happened. I had lunch with Nirmala Sitharaman. She asked me, Minister, how did the meeting go? I said not that great. I said they were kind of reluctant and had a lot of issues. She said don’t worry, I will meet Kristalina Georgieva before you. I will put a word,” he said. 

Ali Sabry went on to note that when he went in for the meeting with the IMF Leadership, the tone had completely changed and was in favour of Sri Lanka.

“When I went for the meeting with the IMF Managing Director, which is one of the most crucial meetings for me, the tone, the approach, the environment, everything had changed. Kristalina Georgieva told me that she had just finished a meeting with Nirmala Sitharaman, and 70-80% of the meeting was not about India, but Sri Lanka, he said. 

Ali Sabry added that this became the foundation of Sri Lanka’s economic recovery.

Watch : https://www.instagram.com/reels/DcbSBMpOtcl/ (Newswire)

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Sri Lanka’s Treasury has received a tranche of USD 695 million following the successful completion of the 5th and 6th reviews of the International Monetary Fund (IMF) programme, Deputy Minister of Finance Anil Jayantha Fernando confirmed.

The IMF Executive Board approved the reviews at its meeting held on May 27. With the latest tranche, total IMF financial support disbursed to Sri Lanka under the programme has reached approximately US$2.4 billion.

In a recent statement announcing the approval for the disbursement of funds, the IMF said Sri Lanka’s performance under the reform programme remained “generally strong”, despite global and domestic challenges, including the war in the Middle East and the aftermath of Cyclone Ditwah.

The IMF noted that Sri Lanka had met all end-December 2025 quantitative performance criteria, while most structural benchmarks had either been achieved or implemented with delays.

The fund also confirmed that prior actions related to restoring fuel and electricity cost-recovery pricing had been completed.

The IMF projects Sri Lanka’s economic growth to slow to 3% in 2026, down from 5% in 2025, mainly due to global uncertainties and rising oil prices linked to the Middle East conflict.

Inflation is expected to rise to 5% in 2026, while the current account balance is projected to return to a deficit.

The IMF said fiscal easing in 2026 was appropriate in response to economic shocks, including recovery spending following Cyclone Ditwah, but stressed that Sri Lanka must return to its fiscal targets from 2027 onwards. (Newswire)

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The International Monetary Fund (IMF) has released the Letter of Intent submitted by the Sri Lankan Government and the Central Bank of Sri Lanka following the completion of the combined Fifth and Sixth Reviews under the Extended Fund Facility (EFF) programme.

The letter, dated 13 May 2026 and signed by President and Finance Minister Anura Kumara Dissanayake and Central Bank Governor Dr. Nandalal Weerasinghe, outlines Sri Lanka’s progress under the IMF-supported programme and its commitments to continue economic reforms aimed at restoring macroeconomic stability and debt sustainability.

In the document, Sri Lanka noted that the economy recorded 5% growth in both 2024 and 2025, supported by improvements in revenue collection, reserve accumulation, and debt restructuring efforts. The Government also highlighted progress in strengthening public finances, rebuilding foreign reserves, and implementing governance reforms.

The Letter of Intent states that while temporary relief measures were introduced in response to Cyclone Ditwah and the impact of the Middle East conflict, the authorities remain committed to maintaining the programme’s fiscal targets.

The Government further reaffirmed its commitment to cost-recovery pricing for fuel and electricity, a key component of the IMF reform programme. According to the letter, temporary subsidies provided to ease the burden on households and businesses will remain within budgeted limits and are expected to be phased out by the end of September 2026.

Sri Lankan authorities informed the IMF that any future support for vulnerable groups would be delivered through targeted welfare programmes while preserving fiscal discipline and ensuring the sustainability of state-owned enterprises.

The letter also requested the IMF Executive Board’s approval for the combined Fifth and Sixth Reviews and access to SDR 508 million (approximately US$695 million) under the EFF arrangement.

The IMF Executive Board approved the reviews on 27 May 2026, enabling the immediate disbursement of the funds. The latest tranche brings Sri Lanka’s total IMF financing under the programme to approximately US$2.4 billion.

The publication of the Letter of Intent provides a detailed account of the commitments and policy measures agreed between Sri Lanka and the IMF as the country continues its economic recovery programme. (Newswire)

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Opposition Leader Sajith Premadasa today called on the government to immediately begin negotiations for a successor programme with the International Monetary Fund (IMF), warning that Sri Lanka is not on track to meet reserve targets under the current arrangement.

“I am calling on the government today to begin negotiations for a successor IMF programme. Not to renegotiate the existing arrangement, which is proceeding. A successor programme, the arrangement that takes effect when this one ends,” Premadasa said in a statement. 

He noted that Sri Lanka currently holds USD 7 billion in gross official reserves, while the IMF’s target for March 2027 stands at USD 14.2 billion. To bridge the gap, the country would need to accumulate USD 600 million in reserves every month for the next twelve months, a pace he said was unrealistic.

Premadasa warned that the rupee has weakened by 14% against the dollar over the past year, while petrol prices have climbed to Rs. 410 per litre, nearing the crisis peak of June 2022. He also highlighted risks to Sri Lanka’s USD 8.1 billion in annual remittances, which depend heavily on Gulf employment amid regional instability caused by the Middle East conflict.

“Sri Lanka is not in a position of strength indefinitely. These are not distant risks,” he cautioned.

Premadasa stressed that Sri Lanka has entered 17 IMF programmes, often only after reserves were depleted and the rupee collapsed, leaving the country with no choice but to accept harsh terms.

“We have a choice right now. The window to negotiate from relative strength with USD 7 billion in reserves, a functioning programme, and demonstrated reform credibility. I am asking this government to plan for March 2027 and explain to the country Sri Lanka’s contingency plan when we fail to meet the IMF target,” he said.

The Opposition Leader stressed that his proposal was not a retreat from fiscal discipline but a call to secure stability beyond the current programme. (Newswire)

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Deputy Minister of Finance Anil Jayantha Fernando told Parliament today (21) that Sri Lanka is expecting a significant inflow of foreign funds from the International Monetary Fund (IMF) by May 27.

“We are largely expecting from the International Monetary Fund on the 27th of this month. The Board of Directors will give us USD 700 million,” he said.

The Deputy Minister explained that in addition to exports and foreign remittances, external financing from multilateral agencies would strengthen the country’s reserves.

“From the Asian Development Bank, within this year, there is the possibility of obtaining up to USD 480 million. From the World Bank, USD 150 million, and from another affiliated institution, USD 50 million,” he noted.

Deputy Minister Fernando stressed that these inflows would ease concerns over foreign exchange management.

“Therefore, there will be no problem in managing this,” he assured.

The IMF disbursement, expected on May 27, is part of Sri Lanka’s ongoing programme to stabilize its economy and strengthen external financing. (Newswire)

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Opposition Leader Sajith Premadasa has claimed that the International Monetary Fund (IMF) no longer engages with him because he speaks on behalf of ordinary citizens burdened by economic hardship.

“The IMF won’t speak to me anymore, as I speak for the innocent, burdened people. They do not like to listen to what I have to say. I speak on behalf of the farmers, fishermen, the poor and innocent, retailers, small and medium‑scale enterprises, and entrepreneurs, but they don’t like it,” he said.

Premadasa, addressing farmers in Buttala in the Monaragala District, accused the government of ignoring the realities faced by the agricultural sector.

“The government says producing a kilo of paddy costs only Rs. 90–95. But when we raise farmers’ issues in Parliament, the response is always ‘there is no issue.’ The Agriculture Minister, K.D. Lal Kantha claims all necessary equipment and fertilizers have been provided. I came here to see if that is true,” he said.

The Opposition Leader further criticized the government’s reliance on IMF‑driven policies, saying officials forget the struggles of farmers when they sit in air‑conditioned rooms negotiating with international lenders.

“The IMF has influenced the government with the thought that the paddy fields are a failure. When these officials engage in discussions with the IMF, wearing suits, they forget the farmers in their sarongs,” he said.

Premadasa warned that either the government or its ministers were misleading the public, stressing that he stood firmly with the farmers. (Newswire)

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The International Monetary Fund (IMF) has said that the completion of Sri Lanka’s combined Fifth and Sixth reviews under its Extended Fund Facility (EFF) is subject to approval by its Executive Board, with a meeting expected in the coming weeks.

Responding to questions at a press briefing held on 14 May, IMF Communications Department Director Julie Kozack said a staff-level agreement between IMF staff and Sri Lankan authorities was reached on 9 April.

She said several prior actions were required before the programme could be presented to the Board, including the restoration of cost-recovery pricing in electricity and fuel, alongside measures to protect vulnerable groups, as well as completion of financing assurances.

Kozack noted that once the review is approved, Sri Lanka would gain access to about US$700 million in financing.

Asked whether the government’s current fuel subsidy, including a 100-rupee per litre diesel subsidy, is consistent with the IMF’s cost-recovery pricing framework, Kozack did not directly comment on the specific measure. Instead, she reiterated that the programme requires both cost-recovery pricing reforms and protections for vulnerable populations.

She also said Sri Lanka has faced “two very large shocks” recently, referring to Cyclone Ditwah and broader external impacts from the Middle East conflict, adding that these have affected the economy and the population.

Despite this, she said Sri Lanka’s reform programme was showing results, pointing to strong fiscal performance in 2025, progress in debt restructuring, 5 per cent economic growth, and a return of inflation to positive territory after a period of deflation.

She further said the IMF remains committed to supporting Sri Lanka as it continues its reform agenda, reaffirming that the institution’s engagement with the country remains strong as it works alongside the authorities to maintain economic stability and progress. 

IMF Press Briefing: https://www.imf.org/en/news/articles/2026/05/14/tr051426-imf-regular-briefing-may-14-2026 (Newswire)

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The International Monetary Fund (IMF) staff and the Sri Lankan authorities have reached a staff-level agreement on economic policies to conclude the combined 5th and 6th Reviews of Sri Lanka’s reform program supported by the IMF’s Extended Fund Facility.

According to the IMF, Sri Lanka will have access to about USD 700 million in financing once the review is approved by the IMF Executive Board.

In a statement, the IMF said that the economic reforms implemented by the Sri Lankan authorities have continued to support the recovery, with reserves accumulating and real GDP growth and revenue mobilization outperforming expectations. 

However, Sri Lanka is significantly exposed to the Middle East conflict and needs to build back better following Cyclone Ditwah.

The IMF further stated that advancing reforms is even more critical now to safeguard macroeconomic stability and maintain the economy on a path towards recovery and inclusive growth. 

Building economic resilience is a necessity to better withstand exogenous shocks amid an uncertain environment, it added. 

Full statement by IMF Mission Chief for Sri Lanka, Evan Papageorgiou:

IMF staff and the Sri Lankan authorities have reached staff-level agreement on the combined Fifth and Sixth Reviews under the 4-year Extended Fund Facility (EFF) arrangement. The arrangement was approved by the IMF Executive Board for a total amount of SDR 2.3 billion (about US$3 billion) on March 20, 2023.

The staff-level agreement is subject to IMF Executive Board approval, contingent on: (i) the restoration of cost-recovery electricity and fuel pricing while protecting the vulnerable and (ii) the completion of the financing assurances review, to confirm multilateral partners’ financing contributions and assess adequate progress with debt restructuring.

Upon completion of the Executive Board review, Sri Lanka would have access to SDR 508 million (about US$700 million), bringing the total IMF financial support disbursed under this arrangement to SDR 1,778 million (about US$2.4 billion).

Sri Lanka’s ambitious reform agenda continues to deliver commendable outcomes. The economy grew by 5 percent y/y in 2025. Inflation has returned to positive territory and rebounded to 2.2 percent y/y in March, and gross official reserves reached US$7 billion in end-March 2026. Fiscal performance in 2025 was strong, primarily supported by taxes on motor vehicle imports. Debt restructuring is nearing completion, with the successful completion of Sri Lankan Airlines’ debt exchange and further progress in finalizing remaining bilateral agreements.

Sri Lanka is significantly exposed to the Middle East conflict, which has heightened energy prices, disrupted a key air hub for tourists, and affected Sri Lankans working in the region. Authorities have ameliorated disruptions to economic activity by securing sufficient fuel supplies for households and industries. At the same time, the country needs to address the infrastructure and spending needs caused by Cyclone Ditwah. Heightened downside risks to the economy from disaster risks, persistent trade policy uncertainty and the conflict in the Middle East emphasize the urgency to accelerate the reform momentum to safeguard macroeconomic stability, enhance Sri Lanka’s resilience to shocks, and maintain the economy on a path toward recovery and inclusive growth.

On this front, it is important to continue building fiscal space through strong revenue measures and prudent spending execution. This requires sustained efforts to improve tax compliance, broaden the tax base, address revenue leakages, and enhance public financial management. It is instrumental to restore and maintain cost-recovery fuel and electricity pricing while assisting the most vulnerable. Continued vigilance is needed to minimize fiscal risks and safeguard fiscal discipline.

As Sri Lanka starts building back better, projects should be prioritized judiciously and spending executed transparently and in compliance with the Public Financial Management Act. Any fiscal support in response to exogenous shocks should be well-targeted, carefully costed, and timebound. Protecting the poor and vulnerable, who are disproportionately affected, should remain a priority, and this calls for the steadfast strengthening of social safety nets by improving their targeting, adequacy, coverage, and shock-responsiveness.

It is important for monetary policy to remain data-dependent and agile to safeguard price stability in the face of shocks. Central bank independence should continue to be upheld, including by continuing to prohibit monetary financing of the budget. Rebuilding foreign reserves while allowing for exchange rate flexibility is a necessity amid global uncertainty. Resolving non-performing loans, promoting sound credit growth, and addressing vulnerabilities in some small licensed finance companies will help safeguard financial stability.

The publication of the 2026 government action plan on governance reforms is welcome; effective implementation will help advance the anti-corruption agenda and support growth. It will be key to uphold the independence of Sri Lanka’s anti-corruption body (CIABOC), support the reliability of the beneficial ownership registry, and strengthen fiscal governance through sound legislation on public-private partnerships, state-owned enterprises, public procurement, and public asset management. Unlocking strong and durable growth for all Sri Lankans requires staying the course on reforms, including by sustaining trade liberalization efforts, accelerating digitalization initiatives, streamlining business regulations, and modernizing labor legislation to reduce rigidities. 

The IMF team held meetings with His Excellency President and Finance Minister Anura Kumara Dissanayake, Honorable Labor Minister and Deputy Minister of Finance and Planning Prof. Anil Jayantha Fernando, Honorable Deputy Minister of Economic Development Nishantha Jayaweera, Central Bank of Sri Lanka Governor Dr. P. Nandalal Weerasinghe, Secretary to the Treasury Dr. Harshana Suriyapperuma, Senior Economic Advisor to the President Mr. Duminda Hulangamuwa, Chief Advisor to the President on Digital Economy Dr. Hans Wijayasuriya, Governor of Southern Province Prof. Susiripala Manawadu, and other senior government and CBSL officials. The IMF team also met with parliamentarians, representatives from the private sector, civil society organizations, and development partners.

We would like to thank the authorities for the excellent collaboration during the mission, including during our visit to Galle in the Southern Province. We reaffirm our commitment to support Sri Lanka at this uncertain time. (Newswire)

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A staff team of the International Monetary Fund (IMF) will visit Sri Lanka from March 26 to April 09, IMF Communications Director Julie Kozack announced.

Addressing the IMF press briefing, Kozack said the visit will focus on discussing economic policies. 

“The aim will be to complete a combined fifth and sixth review of the IMF-supported program while assessing the potential impact of the Middle East conflict on the economy,” she said. 

Kozack further said that as part of the discussion, the team will be engaging with the authorities to better understand what the potential impact of the Middle East conflict could be on Sri Lanka’s economy. 

“When the team returns, it will have an updated assessment of Sri Lanka’s economy and how the IMF can continue to support Sri Lanka. 

The IMF Communications Director went on to note that the IMF is actively engaging with countries affected by the Middle East conflict, assessing global economic risks and standing ready to provide support.  

“We are engaging very actively with our membership. We are talking to them about how we see, as I explained here, how we see some of the impacts on the, on the global economy. But also asking them, how can we best support them at this time, using the full range of tools available to us, including through our policy advice, capacity development and also financial support as needed.

We have engaged with finance ministers and central bank governors in many countries and regions. We’ve also engaged with regional institutions to discuss and share perspectives on the implications of the conflict and again, how the Fund can best provide support. The overall impact, of course, is going to depend very much on the duration and intensity of the conflict.

We will provide an updated assessment in our World Economic Outlook in April, which will be comprehensive for the individual country level and also for global and regional economies,” Kozack added. (Newswire)

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President Anura Kumara Dissanayake met International Monetary Fund (IMF) Managing Director Kristalina Georgieva and her delegation at the Presidential Secretariat for discussions during their three-day visit to Sri Lanka, the President’s Media Division said.

During the meeting, President Dissanayake expressed appreciation for the IMF’s contribution toward stabilizing Sri Lanka’s economy, noting that improved stability had enabled the country to respond effectively to the impact of Cyclone Ditwah.

He said the government had ensured that neither political considerations nor economic interests hindered the national response to the disaster.

The President said the government’s next priority is to ensure that the benefits of recent economic progress are passed on to the public. He noted that rural low-income communities were among the worst affected by the cyclone and said extensive programs have been designed to support their economic recovery and human capital development.

He also said the government looks forward to continued IMF support in advancing these efforts.

Georgieva acknowledged that the IMF had extended emergency financial assistance to Sri Lanka for disaster relief and commended the government’s response to affected communities, as well as its planned approach to rebuilding.

The meeting reaffirmed bilateral cooperation between Sri Lanka and the IMF in promoting economic stability and growth, the statement said. (Newswire)

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International Monetary Fund (IMF) Managing Director Kristalina Georgieva will visit Sri Lanka next month to review the country’s economic reform program and express solidarity following recent natural disasters, IMF Asia and Pacific Department Director Krishna Srinivasan said during a mission to the island.

Srinivasan, leading one of the largest IMF delegations to visit Sri Lanka, said the upcoming visit aims to both acknowledge the progress under the IMF-supported program and directly support communities impacted by the catastrophe.

“She’ll be here both to look at the success of the program and to express the solidarity we have with you,” he told President Anura Kumara Dissanayake on Jan. 28.

This marks Srinivasan’s fourth visit to Sri Lanka and his first outside Colombo. He spent two days in areas beyond the capital, describing the experience as offering a “deeper, more human perspective” of the country.

“In many parts, I saw flooding. I saw roads which need to be repaired,” he said. “Our sympathies are with you and with the people of Sri Lanka for the lives lost and for the impact of the disaster.”

Srinivasan noted strong public appreciation for the government’s reform efforts, especially in governance, during his visits to local communities.

“There’s huge appreciation for what the government has done for the people,” he said.

The regional IMF meeting in Sri Lanka, involving representatives from across Asia, had been planned months earlier. While some suggested canceling the event after the disaster, Srinivasan said the decision was made to proceed as a gesture of support.

“We want to express our solidarity with the people of Sri Lanka,” he said. “We are with you. Our full support is with you.” (Newswire)

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A meeting between President Anura Kumara Dissanayake and representatives of the International Monetary Fund (IMF), who arrived in Sri Lanka to assess the damage caused by Cyclone Ditwah, was held this morning (28) at the Presidential Secretariat.

Emphasising that Sri Lanka is currently moving in the right economic direction despite facing a severe disaster, the IMF representatives stated that there would be no changes to the agreement under the Extended Fund Facility programme with Sri Lanka, and discussions on releasing the sixth tranche will resume in March.

Both parties also agreed to continue implementing the Extended Fund Facility programme without making any changes to the existing agreement.

The IMF delegation, which arrived in the country on the 22nd, travelled across the island to observe first-hand the damage caused by Cyclone Ditwah and met with communities affected by its impact. 

The representatives expressed their regret over the disaster, which occurred at a time when Sri Lanka’s economy was gradually recovering, and over the severe hardships faced by the people as a result. Nevertheless, they commended the Government’s swift actions to provide relief to affected communities, develop infrastructure and restore normalcy to people’s lives while confronting the challenges posed by the disaster. They further noted that many members of the public they had spoken to had expressed appreciation for the manner in which the Government had responded, describing it as a significant achievement. 

The IMF representatives also pointed out that the strong fiscal discipline maintained by the Sri Lankan Government over the past year had been a key factor in addressing this challenge. They noted that the Government’s ability to present a supplementary estimate of Rs. 500 billion was made possible by a surplus in the Treasury, describing this as a highly commendable development. 

President Anura Kumara Dissanayake noted that the disaster had most severely affected poor rural communities, with rural infrastructure and livelihoods suffering extensive damage. He stated that, accordingly, Rs. 500 billion had been allocated to protect rural livelihoods and restore income-generating activities. 

The President further emphasised that this measure does not in any way signify a departure from proper financial management or fiscal responsibility. 

He stated that the Government’s objective is to ensure that the gains reflected in macroeconomic indicators genuinely reach ordinary citizens and that priority is being given to rebuilding the lives of people who have endured prolonged hardship due to events such as the Easter Sunday attacks and the recent economic collapse. The President added that all future Government programmes have been planned in line with this direction and that Sri Lanka expects the continued support of the International Monetary Fund in this regard. 

Representing the Government of Sri Lanka at the meeting were Minister of Labour and Deputy Minister of Economic Development Dr. Anil Jayantha Fernando, Secretary to the Ministry of Finance Dr. Harshana Suriyapperuma, Governor of the Central Bank of Sri Lanka Dr. Nandalal Weerasinghe, Senior Economic Adviser to the President Duminda Hulangamuwa, along with several other officials.

Representing the International Monetary Fund were Director of the Asia and Pacific Department Krishna Srinivasan, Deputy Director for Asia and the Pacific Sanjaya Panth, Mission Chief Evan Papageorgiou, and Resident Representative Martha Woldemichael, among others. (Newswire)

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The International Monetary Fund (IMF) team that visited Sri Lanka to study the impact of Cyclone Ditwah and hold discussions with authorities has now concluded its mission.

The delegation, which arrived on January 22, met with President Anura Kumara Dissanayake, Prime Minister Harini Amarasuriya, Deputy Minister of Labour, Finance and Planning Anil Jayantha Fernando, Central Bank Governor Nandalal Weerasinghe, Treasury Secretary Harshana Suriyapperuma, Senior Presidential Economic Advisor Duminda Hulangamuwa, and other senior officials from the government and Central Bank.

They also engaged with state institutions, the private sector, civil society organizations, and various stakeholders to assess the economic and social impacts of the cyclone. 

Commenting on the visit, which concluded today, Mission Chief for Sri Lanka at the IMF, Evan Papageorgiou, noted that discussions covered damage to infrastructure and livelihoods, fiscal responses to natural disasters, monetary policy, and financial system stability.

The team exchanged information on future policy goals, financing needs, and IMF support available under the Extended Fund Facility (EFF) for Sri Lanka’s recovery and reconstruction. 

Papageorgiou further highlighted the government’s commitment to safeguarding progress in debt and financial stability, strengthening public investment management, reprioritizing projects, and reinforcing social safety nets.

An IMF team is expected to return soon to resume policy discussions for the fifth review of Sri Lanka’s Extended Fund Facility program. 

The IMF further reaffirmed its readiness to support Sri Lanka in safeguarding macroeconomic stability, building resilience, and promoting sustainable growth. (Newswire)

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Managing Director of the International Monetary Fund (IMF), Kristalina Georgieva and Sri Lankan Prime Minister Harini Amarasuriya have engaged in Discussions on the sidelines of the 2026 World Economic Forum in Davos, Switzerland. 

In a statement, the IMF Asia and Pacific said Sri Lanka and its people have shown remarkable resilience in the face of the devastation from Cyclone Ditwah.

The statement further said that, during the talks, IMF Managing Director Kristalina Georgieva reiterated the IMF’s commitment to supporting Sri Lanka’s economic recovery. (Newswire)

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The International Monetary Fund’s (IMF) communications director, Julie Kozack, has announced that an IMF fact-finding mission will visit Sri Lanka from January 22 to 28. 

The team is expected to assess the damage caused by the recent Cyclone Ditwah.

Kozack further said that they will also hold policy discussions related to the country’s Extended Fund Facility (EFF) program. (Newswire)

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The International Monetary Fund has made clear that its immediate priority is to consider Sri Lanka’s request for emergency financing under the Rapid Financing Instrument (RFI). 

An IMF spokesperson emphasized that Board deliberation on the RFI stands at the forefront of engagement with Colombo at this critical juncture. 

Alongside this urgent support, the Fund confirmed that a team will visit Sri Lanka in early 2026 to resume discussions on the Fifth Review of the Extended Fund Facility (EFF).

The IMF spokesperson noted that RFI assistance will complement the country’s existing access under the EFF programme.

“In light of the Sri Lankan authorities’ request for emergency financing, IMF Board consideration of the Rapid Financing Instrument (RFI) request is the priority at the current juncture,”  the IMF spokesperson said on Sunday (07).

The spokesperson noted, “An IMF team will visit Sri Lanka in early 20206 to resume discussions for the completion of the Fifth Review of the Extended Fund Facility (EFF). The support under the RFI is in addition to Sri Lanka’s EFF access.”

The IMF’s Executive Board was to take up Sri Lanka’s fifth review on December 15, and the country was to receive around USD 358 million upon completion.

However, Sri Lanka’s government has requested a USD 200 million RFI in the face of an unprecedented disaster caused by Cyclone Ditwah last week.

Sri Lanka has largely fulfilled most commitments it agreed to for the IMF’s USD 3 billion loan after its unprecedented economic crisis and sovereign debt default in 2022. (Newswire)

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The Ministry of Finance has convened a high-level donor forum bringing together diplomatic missions, bilateral and multilateral development partners and international lending agencies to assess the aftermath of Cyclone Ditwah and coordinate assistance for national relief, rescue and restoration efforts. 

The meeting held today, was co-chaired by the Governor of the Central Bank and the Secretary to the Treasury.

The Secretary to the Treasury presented an overview of the extensive damage caused by the cyclone across all sectors of the country, stressing the government’s intention to transition from emergency response to a broader, long-term recovery framework. He underscored the urgent need for development assistance from bilateral and multilateral partners, particularly rapid humanitarian support such as food supplies, grants, concessional financing and short- to medium-term aid. 

The Central Bank Governor highlighted the importance of external financial support, noting the constraints posed by contracting economic sectors and limited scope for domestic borrowing. Government authorities also urged development partners to encourage international engagement and promote travel to Sri Lanka to help revitalise the tourism sector. 

Development partners reaffirmed their strong commitment to support Sri Lanka during this critical period. A representative of the International Monetary Fund announced that Sri Lanka is expected to receive swift access to approximately USD 350 million, the sixth tranche of the Extended Fund Facility, within two weeks. 

Several development and donor partners have also committed to immediate assistance, including disaster relief missions, emergency services and essential humanitarian supplies such as food, clean drinking water, hygiene kits, medical supplies and emergency healthcare to stabilise affected communities and prevent disease outbreaks. Some countries have already deployed disaster relief and humanitarian teams on the ground. 

Partners also agreed to repurpose and redesign existing loan facilities to support medium-term rehabilitation of damaged economic and social infrastructure, including major roads, bridges, irrigation systems and transport networks. They further explored options for new loan and grant packages to address long-term development needs. 

The World Bank has already initiated a rapid post-disaster assessment, while development partners held detailed discussions on a comprehensive damage and needs assessment covering housing, infrastructure, agriculture and services to mobilise funding for medium- and long-term recovery. 

Sri Lanka extended its deep appreciation to all international development partners for their proactive engagement, solidarity and continued support as the country works to restore essential services, assist affected families and rebuild the nation.

The meeting was attended by senior government officials, including Senior Economic Adviser to the President, Mr.Duminda Hulangamuwa, Senior Additional Secretary to the President, Mr. Russell Aponsu, Secretary to the Ministry of Public Administration, Mr.Aloka Bandara, as well as representatives from the Prime Minister’s Office, Ministry of Foreign Affairs, Foreign Employment and Tourism, the Disaster Management Centre and Treasury Departments. (Newswire)

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The International Monetary Fund (IMF) states it has not evaluated the Sri Lanka Board of Investment-reported foreign direct investment data, refuting reports related to figures handed to the IMF Mission Chief for Sri Lanka.

Issuing a clarification, the IMF said that a recent report inaccurately attributes critical comments about the Board of Investment’s handling of foreign direct investment figures to the IMF Mission Chief for Sri Lanka.

While the IMF stresses the importance of data transparency and genuine investment for Sri Lanka’s economic progress, it has not evaluated the BOI-reported FDI data, it further said. 

The IMF added that the Fund remains focused on supporting Sri Lanka’s reform efforts to improve the investment climate and foster sustainable growth. (Newswire)

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The visiting International Monetary Fund (IMF) staff and the Sri Lankan authorities have reached a staff-level agreement on economic policies to conclude the Fifth Review of Sri Lanka’s reform program supported by the IMF’s Extended Fund Facility. 

According to an IMF statement, once the review is approved by the IMF Executive Board, Sri Lanka will have access to about US$347 million in financing.

The IMF further states that the economic reforms implemented by the Sri Lankan authorities have continued to support the recovery, with inflation progressing to target, reserves accumulating, and real GDP growth and revenue mobilization outperforming expectations, while performance under the program has been strong.

“Advancing reforms is key to ensuring macroeconomic stability, anchoring the recovery, and equipping Sri Lanka to better withstand external shocks amid an uncertain global environment,” it added. 

An International Monetary Fund (IMF) mission team led by Evan Papageorgiou visited Sri Lanka from September 24 to October 9, 2025, to discuss recent macroeconomic developments and progress in implementing economic and financial policies under the Extended Fund Facility (EFF) arrangement. 

At the end of the mission, Papageorgiou issued the following statement:

“IMF staff and the Sri Lankan authorities have reached staff-level agreement on the Fifth Review under the 4-year Extended Fund Facility (EFF) arrangement. The arrangement was approved by the IMF Executive Board for a total amount of SDR 2.3 billion (about US$3 billion) on March 20, 2023.

“The staff-level agreement is subject to IMF Executive Board approval, contingent on: (i) Parliamentary approval of the 2026 Appropriation Bill in line with program parameters and (ii) the completion of the financing assurances review, to confirm multilateral partners’ financing contributions and assess adequate progress with debt restructuring.

“Upon completion of the Executive Board review, Sri Lanka would have access to SDR 254 million (about US$347 million), bringing the total IMF financial support disbursed under the arrangement to SDR 1,524 million (about US$2.04 billion).

“Sri Lanka’s ambitious reform agenda continues to deliver commendable outcomes. The economy grew by 4.8 percent y/y in 2025H1 and we expect growth to remain solid in 2025. Inflation has returned to positive territory and in September prices rose by 1.5 percent y/y. Gross official reserves reached US$6.1 billion at end-September 2025. Fiscal performance in 2025H1 has been strong, primarily supported by taxes on motor vehicle imports. Debt restructuring is nearing completion.

“Program performance is strong, underpinned by good fiscal revenue outcomes and improvements in external resilience. The reform momentum should be sustained to safeguard macroeconomic stability and enhance Sri Lanka’s resilience to shocks. This is particularly important given heightened downside risks to the economy from persistent trade policy uncertainty and geopolitical tensions.

“The 2026 Budget should be in line with program parameters to continue building fiscal space on the back of strong revenue measures and prudent spending execution. This requires sustained efforts to improve tax compliance, broaden the tax base, and tackle revenue leakages by strengthening the tax exemption frameworks. Enhancing public financial management, avoiding the reemergence of expenditure arrears, and promoting high-quality and efficient public expenditure, including by addressing capital spending under-execution, will contribute to safeguarding fiscal discipline and transparency.

“At the same time, it is instrumental to maintain cost-recovery energy pricing, strengthen the governance of state-owned enterprises (SOEs), and resolve their legacy debts to ensure financial viability and minimize fiscal risks. Upcoming bills on public-private partnerships, SOEs, public procurement, and public asset management should be consistent with the Public Financial Management Act and best practices.  

“Protecting the poor and vulnerable should remain a priority. There is scope to strengthen the design of the welfare benefit payment scheme to improve the targeting, adequacy, and coverage of social spending.

“Accelerating the finalization of bilateral debt agreements with the remaining official and commercial creditors is key to restoring debt sustainability and improving investor confidence. A swift operationalization of the Public Debt Management Office will be a key step towards prudent debt management practices.

“It is important for monetary policy to remain data-driven and to ensure price stability. Central bank independence should continue to be safeguarded, including by continuing to refrain from monetary financing of the budget. Efforts should continue to rebuild external buffers through reserve accumulation to adequate levels, while allowing for exchange rate flexibility. Resolving non-performing loans, strengthening governance and oversight of state-owned banks, and improving the insolvency and resolution frameworks are important to foster credit growth and safeguard financial sector stability.

“It is crucial to speed up the implementation of governance reforms outlined in the government’s action plan. Advancing procurement reforms, strengthening the AML/CFT framework, prioritizing anti-corruption measures in revenue administration, including digitalization, and implementation of electronic asset declarations will contribute to reducing corruption vulnerabilities. Recruitment at the Commission to Investigate Allegations of Bribery or Corruption (CIABOC) should be accelerated and CIABOC’s independence safeguarded in line with the Anti-Corruption Act. Structural reforms will be key to lifting Sri Lanka’s potential growth.

“The IMF team held meetings with His Excellency President and Finance Minister Anura Kumara Dissanayake, Honorable Prime Minister Dr. Harini Amarasuriya, Honorable Labor Minister and Deputy Minister of Economic Development Prof. Anil Jayantha Fernando, Honorable Minister of Industry Mr. Sunil Handunnetti, Central Bank of Sri Lanka Governor Dr. P. Nandalal Weerasinghe, Secretary to the Treasury Dr. Harshana Suriyapperuma, Senior Economic Advisor to the President Mr. Duminda Hulangamuwa, Chief Advisor to the President on Digital Economy Dr. Hans Wijayasuriya, Governor of Central Province Prof. Sarath Abayakon, and other senior government and CBSL officials. The IMF team also met with parliamentarians, representatives from the private sector, civil society organizations, and development partners.

“We would like to thank the authorities for the excellent collaboration during the mission, including while visiting the Central and Uva provinces. We reaffirm our commitment to support Sri Lanka achieve strong, sustainable growth.” (Newswire)

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