Sri Lanka has received the first tranche of the IMF bailout programme, President Ranil Wickremesinghe told parliament on Wednesday. The beleaguered island nation was due to receive a $330 million tranche, the first part of a nearly $3 billion bailout approved by the International Monetary Fund on Monday.
“This sets the stage for better fiscal discipline and better governance for Sri Lanka,” Wickremesinghe said. The IMF bailout is expected to catalyse an additional $3.75 billion in support from the likes of the World Bank, the Asian Development Bank, and other lenders. This clears the way for Sri Lanka to rework a substantial portion of its $84 billion public debt.
State Finance Minister Shehan Semasinghe said in an interview that Sri Lanka is ready to engage in restructuring talks bilaterally and with private creditors to recover debt stability “as soon as possible.” It was the 17th IMF bailout for Sri Lanka and the third since the end of the country’s decades-long civil war in 2009.
Economic mismanagement linked to the impact of the COVID-19 pandemic left Sri Lanka at the start of last year severely short of dollars for essential imports, plunging the island nation into its worst financial crisis in seven decades.
