{ "title": "IMF Staff Concludes Visit to Sri Lanka", "publication": "IMF News, July 25, 2025", "sourceUrl": "https://www.imf.org/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka", "canonical": "https://www.imf.org/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka", "overlayPath": "/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka/index.md", "summary": "An International Monetary Fund (IMF) mission team led by Mr. Evan Papageorgiou, IMF Mission Chief for Sri Lanka, visited Colombo during July 21-25, 2025, to discuss recent macroeconomic developments and progress in implementing economic and financial policies under the authorities’ economic reform program supported by the IMF’s Extended Fund Facility (EFF) arrangement.", "publishDate": "2025-07-25", "sections": [ { "heading": "Mission overview", "content": "- IMF mission led by Mr. Evan Papageorgiou, IMF Mission Chief for Sri Lanka, visited Colombo during July 21-25, 2025 to discuss recent macroeconomic developments and progress in implementing policies under the authorities’ economic reform program supported by the IMF’s Extended Fund Facility (EFF) arrangement.\n- End-of-mission statement emphasizes that views are those of IMF staff and do not necessarily represent the IMF’s Executive Board. This mission will not result in a Board discussion.\n- The timing of the Fifth Review of the EFF will be discussed with the government; progress on key program commitments will be formally assessed in that review." }, { "heading": "Key economic findings and indicators", "content": "- Real GDP grew by 4.8 percent y/y in 2025Q1, outperforming expectations.\n- Headline inflation was at -1.1 percent y/y in 2025Q2 and is gradually returning to target.\n- Gross international reserves stood at US$6.0 billion at end-June 2025.\n- Tax revenue collection continued improving, supported by strong performance in VAT and taxes on imported motor vehicles.\n- Downside risks have increased owing to potentially high tariffs on Sri Lanka’s exports, persistent trade policy uncertainty, and heightened geopolitical tensions." }, { "heading": "Policy priorities and recommendations", "content": "- Sustain reform momentum to safeguard macroeconomic stability, entrench the recovery, and build resilience to shocks amid trade policy uncertainty and geopolitical tensions.\n- Fiscal policy and debt:\n - Sustain efforts to raise fiscal revenues to maintain macroeconomic stability.\n - To meet the medium-term primary balance objective of 2.3 percent of GDP, the 2026 budget should be underpinned by strong revenue measures and appropriate spending allocations consistent with program parameters.\n - Strengthen tax exemption frameworks, boost tax compliance, broaden the tax base, and enhance public financial management to avoid reemergence of expenditure arrears.\n - Upcoming bills on public-private partnerships, state-owned enterprises, public procurement, and public asset management should be consistent with the Public Financial Management Act and best practices.\n - Accelerate progress toward operationalizing the Public Debt Management Office.\n - Encourage swift completion of bilateral agreements with remaining official and commercial creditors to restore debt sustainability and regain investor confidence.\n- Monetary and financial sector policy:\n - Monetary policy should remain prudent and prioritize price stability.\n - Safeguard central bank independence, including by refraining from monetary financing of the budget.\n - Continue reserve accumulation and maintain exchange rate flexibility.\n - Resolve non-performing loans, strengthen governance and oversight of state-owned banks, and improve insolvency and resolution frameworks to revive credit growth and support private sector development.\n- Energy and social policy:\n - Maintain cost-recovery energy pricing to minimize fiscal risks and support financial sustainability of energy utilities.\n - Protect the poor and vulnerable through improved targeting, coverage, and adequacy of social support.\n- Governance and structural reforms:\n - Steadfast implementation of governance reforms in the government’s action plan is critical to address corruption vulnerabilities.\n - Advance structural reforms to liberalize trade and investment, increase competitiveness, boost female labor force participation, and address climate change to raise potential growth." }, { "heading": "Stakeholder engagement", "content": "- IMF team met with: His Excellency President and Finance Minister Anura Kumara Dissanayake; Honorable Labor Minister and Deputy Minister of Economic Development Prof. Anil Jayantha Fernando; Central Bank of Sri Lanka Governor Dr. P. Nandalal Weerasinghe; Secretary to the Treasury Dr. Harshana Suriyapperuma; Senior Economic Advisor to the President Duminda Hulangamuwa; Chief Advisor to the President on Digital Economy Dr. Hans Wijayasuriya; other senior government and CBSL officials; and representatives from the private sector, civil society organizations, and development partners.\n\nPress Release No. 25/264 — IMF Communications Department, July 25, 2025\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\n---\n\n References\n\n- Sri Lanka and the IMF\n- Press Releases\n- PRESS CENTER\n- https://www.imf.org/en/home\n\nSource: https://www.imf.org/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka" } ], "bullets": [ "[Markdown version](/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka/index.md)", "[Structured JSON version](/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka/index.json)", "[Bundle manifest](/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka/bundle-manifest.json)", "Published: July 25, 2025", "IMF mission led by Mr. Evan Papageorgiou, IMF Mission Chief for Sri Lanka, visited Colombo during July 21-25, 2025 to discuss recent macroeconomic developments and progress in implementing policies under the authorities’ economic reform program supported by the IMF’s Extended Fund Facility (EFF) arrangement.", "End-of-mission statement emphasizes that views are those of IMF staff and do not necessarily represent the IMF’s Executive Board. This mission will not result in a Board discussion.", "The timing of the Fifth Review of the EFF will be discussed with the government; progress on key program commitments will be formally assessed in that review.", "Real GDP grew by 4.8 percent y/y in 2025Q1, outperforming expectations.", "Headline inflation was at -1.1 percent y/y in 2025Q2 and is gradually returning to target.", "Gross international reserves stood at US$6.0 billion at end-June 2025.", "Tax revenue collection continued improving, supported by strong performance in VAT and taxes on imported motor vehicles.", "Downside risks have increased owing to potentially high tariffs on Sri Lanka’s exports, persistent trade policy uncertainty, and heightened geopolitical tensions.", "Sustain reform momentum to safeguard macroeconomic stability, entrench the recovery, and build resilience to shocks amid trade policy uncertainty and geopolitical tensions.", "Fiscal policy and debt:", "Monetary and financial sector policy:", "Energy and social policy:", "Governance and structural reforms:", "IMF team met with: His Excellency President and Finance Minister Anura Kumara Dissanayake; Honorable Labor Minister and Deputy Minister of Economic Development Prof. Anil Jayantha Fernando; Central Bank of Sri Lanka Governor Dr. P. Nandalal Weerasinghe; Secretary to the Treasury Dr. Harshana Suriyapperuma; Senior Economic Advisor to the President Duminda Hulangamuwa; Chief Advisor to the President on Digital Economy Dr. Hans Wijayasuriya; other senior government and CBSL officials; and representatives from the private sector, civil society organizations, and development partners.", "**Press Release-English**", "[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/)", "[https://www.imf.org/en/home](https://www.imf.org/en/home)" ], "related": [ { "title": "Press Release-English", "role": "document", "sourceUrl": "https://www.imf.org/-/media/files/news/press-release/2025/tamil-imf-staff-concludes-visit-to-sri-lanka-for-immediate-release.pdf", "summary": { "path": "/-/media/files/news/press-release/2025/tamil-imf-staff-concludes-visit-to-sri-lanka-for-immediate-release.pdf.md", "mime": "text/markdown" }, "binary": { "path": "/-/media/files/news/press-release/2025/tamil-imf-staff-concludes-visit-to-sri-lanka-for-immediate-release.pdf", "mime": "application/pdf" } } ], "alternates": { "markdown": "/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka/index.md", "json": "/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka/index.json", "bundleManifest": "/en/news/articles/2025/07/24/pr-25264-sri-lanka-imf-staff-concludes-visit-to-sri-lanka/bundle-manifest.json" }, "generatedAtUtc": "2026-09-26T04:04:04.553Z" }