SL expresses interest to work with IMF: spokesperson

• Sri Lanka says yes to a well-supported financial programme
• Programme discussion to kick off in coming days
• Updated forecast for SL to be released in new World Economic Outlook next month

The International Monetary Fund (IMF) confirmed that Sri Lanka has given the nod to receive support to bail its economy out from the mounting crisis situation.

“The answer is yes,” said IMF spokesperson Gerry Rice sharing an update in a media briefing held this week. 
He affirmed that the Sri Lankan authorities have expressed interest in a well-supported financial programme.
“On the status of the discussion, we plan to initiate those programme discussions with the Sri Lankan authorities, including during the visit of the finance minister in Washington.

“So, we plan to initiate those discussions pretty much in the coming days,” said Rice.

According to Rice, the IMF would update its forecast for Sri Lanka when it releases its new World Economic Outlook next month. The rescue plan from the fund includes a loan programme and is likely to focus on external debt restructuring, greater exchange-rate flexibility and better targeted subsidies.

The island nation has witnessed its foreign reserves contract by 70 percent since January 2020, which has made it challenging to pay and obtain essential imports such as food and fuel.

For the remainder of 2022, Sri Lanka has to repay debt amounting to US $ 4 billion. This includes an international sovereign bond of US $ 1 billion that matures in July.

Alongside the assistance from the IMF, Sri Lanka also plans seeking support from the Work Bank (WB). However, this support is likely to be extended only after the country enters into an IMF support loan programme.