IMF notes broad consensus in new Sri Lanka Government to deal

The International Monetary Fund (IMF) says there is a broad consensus in the new Sri Lankan Government to the existing reforms program.

Krishna Srinivasan, Director of IMF of Asia and Pacific Department said that during his discussions with the new Government held in Colombo there was broad consensus to safeguard and build on the hard won gains under the program.

“I led a high level team to Colombo to discuss the to engage with the authorities. And we had some very, very productive discussions with the new Government and the team there.? And the discussions are continuing this week during the Annual Meetings.? Now, there was broad consensus, I would say unanimous consensus, that Sri Lanka, which was tearing at the abyss in 2022, has come a long way in terms of undertaking reforms which have led to some hard won gains, as you can know.? You’ll note that growth has been positive the last four quarters. Inflation is coming down.? So there is consensus that the new Government, you know from the new government that it would like to safeguard and build on the hard won gains under the program,” he said at a media briefing in Washington.

He also said that under the program there are elements which address some of the priorities of the new Government, including in terms of social protection and so on.

“But the details on the program are continuing and they’ll be happening this week in Washington. And we are encouraged by what we have heard so far and hoping that, you know, we can move fast towards the third review which will come up soon. Now, in terms of there was a question on the debt restructuring. They have reached agreements with the official creditors, and they’ve reached an agreement in principle with the private creditors.? The next step would be to reach a formal agreement with all creditors.? And that’s a big step forward.? And of course that’s not the end.? There’s a lot more work to be done in terms of continuing with the reforms because a long way to go before you’re on the path of strong and sustainable recovery,” Srinivasan added.

He also said there are some concerns on the macro linked bonds and whether these instruments and the restructuring they reach are one consistent with the IMF program targets on debt.? (Colombo Gazette)