Kristalina Georgieva, the Managing Director of the International Monetary Fund (IMF), addressed members of the financial community regarding Sri Lanka's economic reform efforts. In her statement, Georgieva outlined the progress made by Sri Lanka under an IMF-supported program aimed at restoring debt sustainability and enhancing economic governance.
The program is backed by a 48-month Extended Fund Facility arrangement amounting to SDR 2.286 billion (approximately US$3 billion), which was approved by the IMF's Executive Board on March 20, 2023. According to Georgieva, "The program has gotten off to a good start with the economy recovering, inflation remaining low, and reserves being accumulated." She also noted that staff-level agreements have been reached for the third review under this arrangement.
In June 2024, Sri Lanka finalized a memorandum of understanding with its Official Creditors Committee and reached an agreement with China EXIM Bank on debt treatment measures aimed at restoring debt sustainability. This aligns with IMF program parameters.
Georgieva highlighted further progress in negotiations: "Building on this progress...the agreements reached by the Sri Lankan authorities with both the Steering Committee of the Ad Hoc Group of external bondholders, and the Local Consortium of Sri Lanka, mark a significant step forward."
She emphasized that swift completion of these debt operations is crucial for success: “To capitalize on this momentum, rapid completion of the debt operation with high creditor participation would be vital for the success of the program.”
The IMF remains committed to supporting Sri Lanka through its economic reforms. As Georgieva stated, “The continued support from international financial institutions and other official creditors...is necessary to underpin the success of these reform efforts.” The organization stands ready to assist in achieving these goals.