The IMF has approved the third review of Sri Lanka's $2.9 billion bailout, releasing $333 million in funding. While signs of economic recovery emerge, the country still faces critical debt restructuring challenges to move forward with the programme.
The International Monetary Fund (IMF) approved the third review of Sri Lanka's $2.9 billion bailout on Saturday but warned that the South Asian economy remains vulnerable. In a statement, the global lender confirmed it would release approximately $333 million, bringing the total funding to around $1.3 billion, as signs of an economic recovery emerge.
However, Sri Lanka must still complete a $12.5 billion bondholder debt restructuring and a $10 billion debt rework with bilateral creditors, including Japan, China, and India, to progress with the programme, according to the IMF. The bailout, secured in March of the previous year, helped stabilise the economy after Sri Lanka plunged into its worst financial crisis in over seven decades in 2022.
Maintaining tax revenue and continuing reforms of state-owned enterprises will be critical in achieving the primary surplus target of 2.3% of GDP next year, said IMF Senior Mission Chief Peter Breuer, concluding his delegation’s visit to the capital, Colombo. "The authorities have committed to staying within the guardrails of the programme," Breuer stated. "We have agreed on a package for them to achieve their priorities and objectives and, as soon as that is submitted to parliament, the fourth review process will proceed."
Sri Lanka's new president, Anura Kumara Dissanayake, announced this week that an interim budget would be presented to parliament in December. He hopes to complete the debt restructuring by the end of December.
During the crisis, a severe dollar shortage sent inflation soaring to 70%, the currency plummeted to record lows, and the economy contracted by 7.3% at its worst, followed by a 2.3% decline last year. Recently, the rupee has risen by 11.3%, and inflation has disappeared, with prices falling by 0.8% last month.
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Turkish Foreign Minister Hakan Fidan is set to visit Algeria on April 20-21 for high-level strategic talks, according to diplomatic sources.
U.S. Vice President JD Vance met with senior Vatican officials on Saturday for talks that the Vatican described as "cordial," following ongoing criticisms of the Trump administration’s policies, particularly regarding immigration.
Russian President Vladimir Putin announced a temporary ceasefire in Ukraine for Easter, set to last from 6 p.m. Moscow time (1500 GMT) on Saturday until midnight (2100 GMT) following Easter Sunday.
U.S. President Donald Trump announced on Friday his plan to reclassify approximately 50,000 federal workers under a new category, "Schedule Policy/Career," which would make it easier to fire civil servants who do not align with his administration's policy agenda.
The U.S. Supreme Court issued an order early Saturday blocking the deportation of alleged Venezuelan gang members from Texas under the Alien Enemies Act, a wartime law from 1798.
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