KATHMANDU

The International Monetary Fund (IMF) has praised Sri Lanka for making significant progress in implementing difficult but necessary reforms. The IMF has acknowledged the positive outcomes of Sri Lanka’s reform efforts and the temporary indicators of economic stabilization. The IMF team, led by Peter Breuer and Catherine Svensson, supported the approval of the extended fund facility arrangement to review and discuss economic and financial policies during their visit to Colombo from September 14 to 27.

According to the statement issued after the discussions, it is stated that “in September 2022, inflation remained at 70 percent and is projected to decrease below two percent by September 2023, and the total international reserves increased by $1.5 billion in March-June of this year. Despite the initial signs of stabilization, full economic recovery is not yet assured.”

In the second quarter, real gross domestic product (GDP) growth was recorded at 3.1 percent, and economic indicators for high-frequency data continue to provide mixed signals. Breuer also mentioned the recent decline in savings, stating that “ensuring the sustained momentum of reforms on the path to robust, stable, and inclusive economic growth is crucial.”