The Executive Board of the International Monetary Fund (IMF) on Monday completed the Fifth Review of Sri Lanka’s economic performance under the program supported by an extended arrangement under the Extended Fund Facility (EFF), making available SDR 118.5 million (about US$ 164.1 million) for disbursement.
In a media release, the IMF said that with the completion of this review, upon the granting of waivers of nonobservance for the end December 2018 performance criteria on the primary balance and net official international reserves, the total disbursements under the arrangement reaches SDR 833.73 million (about $1.155 billion). The Executive Board also approved an extension of the arrangement by one additional year, until June 2, 2020, with re-phasing of remaining disbursements.
Following the Executive Board’s discussion of the review, Mitsuhiro Furusawa, Deputy Managing Director and Acting Chair of the Board, issued the following statement: “We join Executive Directors in extending our condolences to the government and people of Sri Lanka for the loss of life and suffering caused by the recent terror attacks.
“The Sri Lankan authorities have successfully brought the programme back on track, despite important setbacks, by advancing fiscal consolidation through a well-targeted 2019 budget, rebuilding reserves, while maintaining a prudent monetary policy under greater exchange rate flexibility, and reviving structural reforms. Sustaining policy discipline remains critical to strengthen resilience, given still sizable public debt and low external buffers, and support strong and inclusive growth.
“Sustained revenue mobilization is needed to place public debt on a downward path, while making space for critical public investment and an expansion of the social safety net under well-defined selection criteria. Strengthening the selection and appraisal process of large-scale investment projects and assessing their fiscal affordability is critical, given Sri Lanka’s high public debt. Stronger fiscal rules and a medium-term debt management strategy will support medium-term fiscal consolidation and debt reduction efforts.
“The authorities should renew their efforts to strengthen SOE governance and transparency, including by advancing a restructuring plan for SriLankan Airlines and completing energy pricing reforms, building on important progress with the implementation of the fuel pricing formula.
“The Central Bank of Sri Lanka should continue to pursue a prudent and data-dependent monetary policy. The amendments to the central bank law will be a major step in the transition to flexible inflation targeting. Efforts to build reserves should be sustained, under greater exchange rate flexibility, to protect the economy against shocks. Harmonizing regulation and supervision of financial institutions, strengthening the macroprudential policy framework, and enhancing the crisis-preparedness toolkit will help further strengthen financial sector stability.
“Continued implementation of structural reforms is essential to support strong and inclusive growth. Efforts should focus on liberalizing trade, improving the business environment and promoting investment, strengthening governance, encouraging female and youth labor force participation, enhancing social protection, and improving crisis preparedness to natural disasters.” - ENDS -
Speaker Karu Jayasuriya told Parliament a short while ago that the debate on the No-Confidence Motion (NCM) on Minister Rishad Bathiudeen will be h...
23 May 2019 - Views : 34
23 May 2019
23 May 2019
23 May 2019
Though security considerations in the aftermath of the Easter Sunday terrorist attacks led to the cancellation o...
The Gamini Dissanayake Foundation opened its new Head Office at the first floor of the Blue Ocean Apartment building ...
The Sri Lankan High Commission in London, recently hosted a reception for the Sri Lankan cricket team in the UK that ...
The deadline for accepting short film entries for the 'PAURA' Short Film Festival organised by the Elect...