Crisis-ridden Sri Lanka's economic reforms are yielding results, but challenges remain, IMF says
ABC News
The International Monetary Fund says debt-stricken Sri Lanka’s economic reform program is yielding the first signs of recovery, but the improvements still need to translate into improved living conditions for its people
COLOMBO, Sri Lanka -- Debt-stricken Sri Lanka’s economic reform program is yielding the first signs of recovery, but the improvements still need to translate into improved living conditions for its people, the International Monetary Fund said Friday.
Sri Lanka has been struggling with an economic crisis since declaring bankruptcy in April 2022 with more than $83 billion in debt, more than half of it to foreign creditors.
The crisis caused severe shortages of food, fuel and other necessities. Strident public protests led to the ouster of then-President Gotabaya Rajapaksa. The IMF agreed last March to a $2.9 billion bailout package, and released the first payment shortly thereafter and the second tranche last month.
The IMF said Sri Lanka’s real GDP grew by 1.6% in the third quarter of 2023, the first expansion in six consecutive quarters. Shortages of essentials have eased, inflation remains contained and the country’s external reserves increased by $2.5 billion in 2023, it said.
“The economic reform program implemented by the Sri Lankan authorities is yielding the first signs of recovery,” said Pete Breuer, the IMF’s senior mission chief for Sri Lanka.
