A high-level delegation from the International Monetary Fund (IMF) is set to arrive in Sri Lanka on Wednesday to engage with the new administration, led by President Anura Kumara Dissanayake. The discussions will focus on the latest economic reforms backed by the global financial institution.
On September 24, the IMF announced its intent to begin talks with the Dissanayake government, which recently assumed power. The primary agenda includes determining the timeline for the third review of the ongoing economic reform program, supported by a 48-month loan agreement.
Previously, the administration under former President Ranil Wickremesinghe had been negotiating the release of the fourth tranche of the $2.9 billion IMF facility. The transition of power led to a delay in the program’s progress.
The IMF delegation, led by Krishna Srinivasan, Director of the Asia Pacific Department, will be in Colombo from October 2-4 to meet President Dissanayake and his newly appointed economic team. They will review Sri Lanka’s economic developments and reforms under the IMF-supported program, according to an official statement.
This meeting marks the first interaction between the IMF and the newly elected National People’s Power (NPP) government since its victory in the September 21 elections.
Anura Kumara Dissanayake was sworn in as Sri Lanka’s ninth president on September 23, with hopes that his leadership would bring much-needed economic recovery and curb corruption. Dissanayake, leader of the Marxist Janatha Vimukthi Peramuna (JVP) and its broader coalition, the National People’s Power (NPP), defeated his main rival, Sajith Premadasa, of the Samagi Jana Balawegaya (SJB) in the presidential race.
The NPP government has expressed its intent to renegotiate the IMF agreement, citing that the existing terms have imposed significant burdens on the general population.
The upcoming talks are critical for the release of the fourth tranche of the $2.9 billion loan, which had been postponed due to the elections. The third review, which is a precondition for the disbursement, was initially scheduled for December 2023.
Meanwhile, ahead of the IMF visit, government officials on Monday announced that plans to restructure the national carrier, SriLankan Airlines, had been abandoned. While no official statement has been made, the restructuring of the airline had been a key issue in the IMF’s governance diagnostic report, particularly concerning the country’s loss-making state-owned enterprises.
In July, the Wickremesinghe administration had scrapped a plan to sell SriLankan Airlines, despite having shortlisted three potential buyers.
