IMF to continue discussions on prospective EFF with Sri Lanka

Colombo, Sri Lanka

WASHINGTON, DC, Aug 21 – Staff from the International Monetary Fund (IMF) will be visiting Colombo, Sri Lanka from Aug 24-31 to continue their discussions with the Sri Lankan authorities on economic and financial reforms and policies.

In a statement issued on Friday, the IMF said the objective is to make progress towards reaching a staff-level agreement on a prospective IMF Extended Fund Facility (EFF) arrangement in the near term.

“Because Sri Lanka’s public debt is assessed as unsustainable, approval by the IMF Executive Board of the EFF program would require adequate assurances by Sri Lanka’s creditors that debt sustainability will be restored,” the statement said.

The IMF team, to be led by Peter Breuer and Masahiro Nozaki, is also expected to continue the engagement with other stakeholders during the visit.

Sri Lanka has been mired in an unprecedented economic crisis in the last two years followed by the Covid-19 pandemic, high debts and mismanagement of resources among other factors. With its depleted foreign reserves, the country has been also facing a serious shortage of fuel and gas. While India and China have been among several foreign countries that have provided loans and other immediate assistance to the country, its road to economic recovery is expected to be long.