Release of EFF second tranche soon
Posted on October 1st, 2023

Courtesy The Daily News

The Government is confident that it will be able to reach a staff level agreement this week on the release of the second tranche of the Extended Fund Facility (EFF) to be provided by the International Monetary Fund (IMF), State Minister of Finance Shehan Semasinghe said.

An IMF mission team led by Peter Breuer and Katsiaryna Svirydzenka visited Colombo from September 14 to 27, 2023 to discuss economic and financial policies to support the approval of the First Review of the programme under the EFF arrangement.

The IMF team had constructive and productive discussions with the Sri Lankan authorities on economic performance and policies underpinning the first review under the IMF, EFF arrangement.

The Government expects it will be able to reach the staff level agreement, which was not reached during IMF delegation visit. The Sri Lankan and IMF authorities also discussed ways  on regaining debt sustainability through the execution of the domestic debt restructuring and advancing discussions with external creditors and increasing Government revenue.

Central Bank Governor Dr. Nandalal Weerasinghe said the talks with the IMF is continuing and Sri Lanka hoped to enter into a staff level agreement soon on the release of the second tranche of EFF facility.

After obtaining the agreement at staff level, the delegation will forward the programme with recommendations for the next steps to be taken regarding the release of the second tranche to Sri Lanka to the Executive Board of the International Monetary Fund.

Sri Lanka received an extended fund facility of US$ 2.9 billion from the International Monetary Fund. US$ 333 million was given to Sri Lanka as the first installment. Sri Lanka will receive US$ 300 million as its second installment.

With this credit facility possibility for Sri Lanka to obtain financial facilities from institutions such as the World Bank, Asian Development Bank, and other foreign lenders will increase.

In addition it will also boost foreign investor confidence.

The Central Bank Governor expressed hope that through all this, the economic growth of this country will overcome the negative level and attain a positive growth.

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