IMF Says Sri Lanka's Policy Framework Stronger Than In The Past

COLOMBO (News 1st); IMF mission chief Evan Papageorgiou on Thursday (21) painted a firmer, more confident picture of Sri Lanka’s economic policy framework as the Fund’s Executive Board prepares to consider the combined Fifth and Sixth Reviews of the country’s Extended Fund Facility (EFF) on Wednesday, 27 May.

“Sri Lanka’s reform program continues to move forward,” Papageorgiou said, stressing that “Sri Lanka’s policy framework today is considerably stronger than in the past.”

The IMF view, voiced at a critical moment for the island’s finances , frames the coming Board decision as a test of whether progress on macro stability, reserve rebuilding and investor confidence will translate into continued financial support.

The Executive Board’s decision could unlock the sixth and seventh tranches of the EFF, together worth about USD 700 million.

IMF mission chief Evan Papageorgiou said that the authorities’ recent progress in restoring macroeconomic stability and rebuilding reserves has been recognised by the public, investors and stakeholders.

Global shocks continue to pose renewed pressures, but the Fund emphasised that a stronger policy stance means Sri Lanka is better placed to navigate them.

Papageorgiou’s message was both assessment and admonition: while applauding reforms, he urged consistency. “Maintaining a consistent policy course and continuing to allow the economy to adjust to evolving conditions will be key to sustaining the gains achieved so far,” he said.

Papageorgiou concluded by underlining continued partnership. “We look forward to continued close engagement with the Sri Lankan authorities as the reform agenda advances,” he said.