Sri Lanka's NPP Government Secures Major IMF Agreement

Sri Lanka’s new NPP government has secured IMF approval for a staff-level agreement to access a bailout facility. The agreement follows critical debates over reforms by the previous government and promises continued economic reforms under the new leadership, enhancing economic confidence and sustainability.

On Saturday, Sri Lanka's new National People's Power (NPP) government received approval from the International Monetary Fund (IMF) for a staff-level agreement, paving the way for the fourth tranche of a nearly USD 3 billion bailout facility. The move is seen as a crucial step in reviving the island nation's economy.

The previous administration under Ranil Wickremesinghe had entered into the IMF bailout during March 2023 amid severe economic challenges. The leadership change with President Anura Kumara Dissanayake, who initially criticized the bailout's strict conditions, now confirms the program's continuation, underlining policy consistency.

The IMF highlighted that the reforms are yielding positive outcomes, with the economy growing by an average of four percent till June 2024 and steps towards making debt sustainable. The new government aims to boost governance reforms and economic confidence, ensuring resilient and inclusive growth.

(With inputs from agencies.)