IMF Board Decision on Sri Lanka Expected Within Weeks

COLOMBO (News 1st); The International Monetary Fund (IMF) expects its Executive Board to meet in the coming weeks to consider approval of Sri Lanka’s combined fifth and sixth review under the Extended Fund Facility (EFF), a decision that could unlock approximately 700 million US dollars in financing for the country.

Julie Kozack, Director of the IMF Communications Department, said the staff-level agreement between the IMF team and Sri Lankan authorities was reached on April 9. However, completion of the review remains subject to Executive Board approval.

She noted that several prior actions had to be completed before the programme could be presented to the Board. These included restoring cost-recovery pricing for electricity and fuel, while also ensuring protection for vulnerable groups, as well as completing the financing assurances review.

Kozack emphasized that the transition to cost recovery involved a dual approach, moving towards full pricing while safeguarding vulnerable populations.

Once approved, the programme will provide Sri Lanka with access to around 700 million US dollars in financing, with the IMF expecting the Board meeting to take place within weeks.

Addressing flexibility within the programme, Kozack highlighted that Sri Lanka has faced two major shocks in recent times. She pointed to Cyclone Ditwah as a significant economic and humanitarian crisis, describing it as “tragic and devastating” for the country. In addition, she noted the impact of the ongoing war in the Middle East.

Despite these challenges, Kozack said the Sri Lankan economy and its people have shown “remarkable resilience.” She noted that the reforms implemented under the IMF-supported programme over the past several years are beginning to deliver results.

According to the IMF, Sri Lanka’s strong economic performance is being underpinned by these reforms, with fiscal performance in 2025 described as particularly strong, driven largely by revenue improvements. Debt restructuring is also nearing completion.

Kozack further highlighted that the country’s economy grew by 5 percent in 2025. Inflation, which had previously been in negative territory indicating economic weakness, has now returned to positive levels.

She added that Sri Lanka’s debt-to-GDP ratio is expected to continue on a downward trajectory.

Summing up the current outlook, Kozack said the Sri Lankan economy is performing well and that the authorities have demonstrated strong commitment to maintaining reforms.

The IMF, she stressed, remains fully committed to supporting Sri Lanka and will continue working closely with the government to ensure progress toward a more stable economic future.