{
  "title": "IMF Executive Board Completes the First Review Under the Extended Fund Facility Arrangement with Sri Lanka",
  "publication": "IMF News, December 12, 2023",
  "sourceUrl": "https://www.imf.org/en/news/articles/2023/12/12/pr23439-sri-lanka-imf-executive-board-completes-first-review-under-eff-arrangement",
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  "summary": "The IMF Board completed the first review under the 48-month Extended Fund Facility with Sri Lanka, providing the country with access to SDR 254 million (about US$337 million) to support its economic policies and reforms.",
  "publishDate": "2023-12-12",
  "sections": [
    {
      "heading": "Review outcome and financing",
      "content": "- The Executive Board completed the first review under the 48-month Extended Fund Facility (EFF) Arrangement.\n- Immediate disbursement: SDR 254 million (about US$337 million).\n- Total IMF financial support disbursed so far: SDR 508 million (about US$670 million).\n- Total EFF Arrangement amount at program approval (March 20, 2023): SDR 2.286 billion (about US$3 billion)."
    },
    {
      "heading": "IMF assessment of program performance",
      "content": "- Overall program performance: satisfactory.\n- Quantitative performance criteria at end-June: all met except the one on expenditure arrears.\n- Indicative targets at end-June: all met except the one on tax revenues.\n- Structural benchmarks due by end-October 2023: most either met or implemented with delay.\n- Governance milestone: publication of the Governance Diagnostic Report — the first in Asia and a structural benchmark under the program."
    },
    {
      "heading": "Progress on macroeconomic objectives and debt treatment",
      "content": "- Commendable progress noted on:\n  - Restoring debt sustainability.\n  - Raising revenue.\n  - Rebuilding reserve buffers.\n  - Reducing inflation.\n  - Safeguarding financial stability.\n- Debt treatment developments:\n  - Agreements-in-principle with the Official Creditors Committee and Export-Import Bank of China on debt treatments are consistent with EFF targets.\n  - Swift completion and signature of Memoranda of Understanding with official creditors are important.\n  - Timely implementation of agreements and reaching comparable terms with external private creditors should help restore debt sustainability over the medium term."
    },
    {
      "heading": "Policy priorities and recommendations",
      "content": "- Sustaining reform momentum and strong ownership of reforms is paramount.\n- Key priorities listed by the IMF:\n  - Advancing revenue mobilization.\n  - Aligning energy pricing with costs.\n  - Strengthening social safety nets and protecting social spending.\n  - Rebuilding external buffers.\n  - Safeguarding financial stability.\n  - Eradicating corruption and enhancing governance.\n  - Reinforcing revenue-based fiscal consolidation supported by revenue administration reforms.\n  - Central Bank focus: continue the multi-pronged disinflation strategy and accumulate reserves, supported by exchange rate flexibility.\n  - Financial sector: implement the bank recapitalization plan and strengthen financial supervision and crisis management framework."
    },
    {
      "heading": "Selected economic indicators and projections (highlights)",
      "content": "- Real GDP growth:\n  - 2020: -4.6\n  - 2021: 3.5\n  - 2022: -7.8\n  - 2023 (Est.): -3.6\n  - 2024 (Projections): 1.8\n  - 2025: 2.7\n  - 2026: 3.0\n  - 2027: 3.1\n  - 2028: (no figure provided)\n- Inflation (average, Colombo CPI):\n  - 2020: 4.6\n  - 2021: 6.0\n  - 2022: 45.2\n  - 2023 (Est.): 17.9\n  - 2024 (Projections): 7.9\n  - 2025: 5.6\n  - 2026: 5.4\n  - 2027: 5.3\n  - 2028: 5.2\n- Public finance (in percent of GDP) — selected:\n  - Revenue and grants:\n    - 2020: 8.8\n    - 2021: 8.3\n    - 2022: 10.2\n    - 2023: 13.0\n    - 2024: 15.0\n    - 2025: 15.1\n    - 2026: 15.2\n  - Expenditure:\n    - 2020: 21.0\n    - 2021: 20.0\n    - 2022: 18.5\n    - 2023: 19.0\n    - 2024: 20.3\n    - 2025: 19.7\n    - 2026: 19.3\n  - Central government balance:\n    - 2020: -12.2\n    - 2021: -11.7\n    - 2022: -10.2\n    - 2023: -8.8\n    - 2024: -4.2\n    - 2025: -3.9\n- Central government debt (in percent of GDP):\n  - 2020: 96.7\n  - 2021: 102.7\n  - 2022: 115.5\n  - 2023: 107.8\n  - 2024: 110.3\n  - 2025: 111.4\n  - 2026: 110.8\n  - 2027: 108.0\n  - 2028: 104.6\n- Public debt 2/ (in percent of GDP):\n  - 2020: 105.1\n  - 2021: 114.9\n  - 2022: 125.8\n  - 2023: 114.1\n  - 2024: 115.9\n  - 2025: 116.3\n  - 2026: 115.1\n  - 2027: 111.7\n  - 2028: 107.9\n- Gross official reserves (end of period, in millions of U.S. dollars):\n  - 2020: 5,664\n  - 2021: 3,139\n  - 2022: 1,898\n  - 2023: 3,806\n  - 2024 (Proj.): 5,346\n  - 2025: 7,477\n  - 2026: 9,894\n  - 2027: 13,525\n  - 2028: 15,320\n- Gross official reserves (In percent of ARA composite metric):\n  - 2020: 46.0\n  - 2021: 24.7\n  - 2022: 16.4\n  - 2023: 33.2\n  - 2024: 44.7\n  - 2025: 59.9\n  - 2026: 77.1\n  - 2027: 99.7\n  - 2028: 109.6\n- Usable Gross official reserves (end of period) 3/:\n  - 2020: 1,565\n  - 2021: 462\n  - 2022: 2,371\n  - 2023: 3,910\n  - Subsequent row shows: 1.0; 20.7; 32.7 (as provided)\n- External debt (public and private, in billions of U.S. dollars):\n  - 2020: 53.4\n  - 2021: 58.4\n  - 2022: 57.4\n  - 2023: 53.8\n  - 2024: 55.5\n  - 2025: 57.7\n  - 2026: 63.4\n  - 2027: 65.1\n- External debt (as a percent of GDP):\n  - 2020: 63.2\n  - 2021: 65.9\n  - 2022: 76.7\n  - 2023: 64.7\n  - 2024: 68.0\n  - 2025: 70.4\n  - 2026: 71.8\n  - 2027: 72.7\n  - 2028: 70.3\n- Balance of payments (in millions of U.S. dollars) — selected:\n  - Exports:\n    - 2020: 10,048\n    - 2021: 12,499\n    - 2022: 13,106\n    - 2023: 12,365\n    - 2024: 13,555\n    - 2025: 14,377\n    - 2026: 15,111\n    - 2027: 15,846\n    - 2028: 16,651\n  - Imports:\n    - 2020: -16,055\n    - 2021: -20,638\n    - 2022: -18,291\n    - 2023: -17,887\n    - 2024: -20,718\n    - 2025: -23,002\n    - 2026: -24,322\n    - 2027: -25,144\n    - 2028: -26,049\n  - Current account balance:\n    - 2020: -1,187\n    - 2021: -3,285\n    - 2022: -744\n    - 2023: 1,232\n    - 2024: -634\n    - 2025: -908\n    - 2026: -879\n    - 2027: -846\n    - 2028: -764\n  - Current account balance (in percent of GDP) — series includes values such as:\n    - 2020: 0.5\n    - 2021: -2.1\n    - 2022: 0.1\n    - 2023: 2.9\n    - 2024: 1.2\n    - 2025: 0.9\n    - 2026: 1.1\n    - 2027: 1.3\n    - 2028: (no figure provided)"
    },
    {
      "heading": "Risks and implementation emphasis",
      "content": "- Timely completion of creditor agreements and comparable treatment from external private creditors are critical risks/conditions for restoring debt sustainability.\n- Continued timely implementation of structural and governance reforms is emphasized to deliver tangible economic gains to citizens.\n- Protecting the poor and vulnerable via strengthened social safety nets remains a priority while pursuing fiscal consolidation.\n\nSource: IMF Press Release No. 23/439 — \"IMF Executive Board Completes the First Review Under the Extended Fund Facility Arrangement with Sri Lanka\", December 12, 2023.\n\n---\n\n Content in this bundle\n\n- Press Release-English\n  - Press Release-English (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - Press Release-English (PDF){rel=\"external\" type=\"application/pdf\"}\n- pr23439-tamil-sri-lanka\n  - pr23439-tamil-sri-lanka (Markdown version){rel=\"alternate\" type=\"text/markdown\"}\n  - pr23439-tamil-sri-lanka (PDF){rel=\"external\" type=\"application/pdf\"}\n\n---\n\n References\n\n- Kenji Okamura\n- Sri Lanka and the IMF\n- Press Releases\n- PRESS CENTER\n- Press Release\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2023/12/12/pr23439-sri-lanka-imf-executive-board-completes-first-review-under-eff-arrangement"
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    "Published: December 12, 2023",
    "The Executive Board completed the first review under the 48-month Extended Fund Facility (EFF) Arrangement.",
    "Immediate disbursement: SDR 254 million (about US$337 million).",
    "Total IMF financial support disbursed so far: SDR 508 million (about US$670 million).",
    "Total EFF Arrangement amount at program approval (March 20, 2023): SDR 2.286 billion (about US$3 billion).",
    "Overall program performance: satisfactory.",
    "Quantitative performance criteria at end-June: all met except the one on expenditure arrears.",
    "Indicative targets at end-June: all met except the one on tax revenues.",
    "Structural benchmarks due by end-October 2023: most either met or implemented with delay.",
    "Governance milestone: publication of the Governance Diagnostic Report — the first in Asia and a structural benchmark under the program.",
    "Commendable progress noted on:",
    "Debt treatment developments:",
    "Sustaining reform momentum and strong ownership of reforms is paramount.",
    "Key priorities listed by the IMF:",
    "Real GDP growth:",
    "Inflation (average, Colombo CPI):",
    "Public finance (in percent of GDP) — selected:",
    "Central government debt (in percent of GDP):",
    "Public debt 2/ (in percent of GDP):",
    "Gross official reserves (end of period, in millions of U.S. dollars):",
    "Gross official reserves (In percent of ARA composite metric):",
    "Usable Gross official reserves (end of period) 3/:",
    "External debt (public and private, in billions of U.S. dollars):",
    "External debt (as a percent of GDP):",
    "Balance of payments (in millions of U.S. dollars) — selected:",
    "Timely completion of creditor agreements and comparable treatment from external private creditors are critical risks/conditions for restoring debt sustainability.",
    "Continued timely implementation of structural and governance reforms is emphasized to deliver tangible economic gains to citizens.",
    "Protecting the poor and vulnerable via strengthened social safety nets remains a priority while pursuing fiscal consolidation.",
    "**Press Release-English**",
    "**pr23439-tamil-sri-lanka**",
    "[Kenji Okamura](https://www.imf.org/en/About/senior-officials/Bios/kenji-okamura)",
    "[Sri Lanka and the IMF](http://www.imf.org/external/country/LKA/index.htm)",
    "[Press Releases](https://www.imf.org/en/news/searchnews)",
    "[PRESS CENTER](http://presscenter.imf.org/)",
    "[Press Release](https://www.imf.org/en/News/Articles/2023/03/20/pr2379-imf-executive-board-approves-under-the-new-eff-arrangement-for-sri-lanka)",
    "[https://www.imf.org/en/home](https://www.imf.org/en/home)"
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