IMF Approves Third Tranche of Sri Lanka Bailout After Second Review


The International Monetary Fund (IMF) has approved the third tranche of Sri Lanka's bailout under its Extended Fund Facility (EFF) Arrangement, following the completion of the second review. This approval enables Sri Lanka to draw Special Drawing Rights (SDR) 254 million (approximately US$336 million), bringing the total disbursed support to SDR 762 million (around US$1 billion).

The EFF arrangement, initiated on March 20, 2023, aims to restore Sri Lanka's macroeconomic stability and debt sustainability. The IMF noted emerging signs of recovery, with a 3% GDP growth in the latter half of 2023 and an inflation rate of 0.9% in May 2024.The economy remains fragile due to ongoing debt restructuring and other vulnerabilities. The IMF highlighted the need for sustained reforms and fiscal discipline to ensure long-term economic stability and growth.