Sri Lanka Interim Debt Policy Overview
Showing their commitment to reform, the Authorities achieved a Staff-Level Agreement ("SLA")
with the IMF in record time
The SLA provides a clear roadmap in terms of policy implementation and will serve as an anchor for the economic recovery
On September 1st, after months of negotiations and in a major step towards addressing the country's ongoing crisis, the Sri Lankan
Authorities reached a Staff-level Agreement with the IMF Staff on a set of comprehensive economic policies supported by a 4-year US$2.9
billion Extended Fund Facility
The objectives of the contemplated IMF program are:
○ An ambitious primarily revenue-based fiscal consolidation, accompanied by fiscal institutional reforms and cost-recovery based
energy pricing, aimed at restoring fiscal sustainability and strengthening fiscal discipline
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A stronger social safety net to protect the most vulnerable
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O
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A public debt management strategy aimed at restoring public debt sustainability
A multipronged strategy to restore price stability and rebuild international reserves under greater exchange rate flexibility
Commitment to greater central bank independence and to phase out monetary financing
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Policies to safeguard financial system stability
О Focused reforms to address governance and corruption vulnerabilities
Broader structural reforms to unlock Sri Lanka's growth potential
The agreement is subject to the approval of the IMF management and its Executive Board, after the timely
implementation by the Authorities of a set of Prior Actions and the provision by official creditors of assurances to
assist Sri Lanka in restoring public debt sustainability
Sources: Ministry of Finance, Economic Stabilization and National Policies, Central Bank of Sri Lanka, IMFView entire presentation