IMF pledges continued support for Lanka

The International Monetary Fund (IMF) on Thursday (15) reaffirmed its willingness to continue supporting Sri Lanka beyond the end of its current programme, saying a range of options would remain available as the country consolidates its economic recovery.

IMF Deputy Director for the Asia and Pacific Department Sonali Jain-Chandra said the Fund remained committed to assisting Sri Lanka in whatever form the authorities deemed appropriate, including a fresh financing arrangement, policy advice, surveillance and capacity development.

She said the nature of any future engagement would depend on the preferences of the Sri Lankan authorities, with discussions to be held in due course. Regardless of the arrangement, she stressed, the IMF would remain a committed partner to the country.

The remarks come as Sri Lanka approaches the final phase of its current IMF-supported programme, which is scheduled to conclude in March next year.

However, Jain-Chandra cautioned that significant work remained under the existing arrangement. A staff-level agreement on the programme’s Seventh Review, reached between the IMF and the Sri Lankan authorities in early October, is expected to be considered by the IMF Executive Board in the coming weeks.

A further review mission is also expected before the programme expires, she said, underscoring the need for Sri Lanka to sustain its focus on macroeconomic stability and continue implementing reforms.

Assessing the progress made under the programme, Jain-Chandra said Sri Lanka’s macroeconomic conditions had improved substantially since the depths of the economic crisis.

Fiscal performance had been particularly strong, with government revenue doubling during the reform period, while debt restructuring efforts were now largely complete, she said.

The economy has also recorded positive growth for 11 consecutive quarters following the severe contraction experienced during the crisis, she added.

Jain-Chandra highlighted structural reforms, including measures to strengthen governance, as another important component of the programme.

The gains demonstrated that the reform agenda was delivering significant results, she said, while stressing the importance of consolidating the progress made and ensuring that the recovery remained sustainable.

The IMF’s willingness to consider continued engagement beyond the current programme offers a measure of reassurance as Sri Lanka seeks to preserve its economic gains and strengthen confidence among investors and development partners.