IMF review team in town

IMF review team in talks with Finance Minister Ravi Karunanayake yesterday

An International Monetary Fund (IMF) review team which in town to assess the country’s fiscal consolidation plan ahead of disbursing the second tranche of a $ 1.5 billion arrangement yesterday met Finance Minister Ravi Karunanayake.IMF Representative Jaewoo Lee and Country Representative for Sri Lanka and Maldives Eteri Kyintradgze met the Finance Minister at his office and reviewed the progress of the reforms agenda of the Government, the Finance Ministry said in a statement. 

Treasury Secretary Dr. R.H.S. Samaratunga also joined the Finance Minister at the discussion. The Executive Board of the IMF in June had approved a 36-month extended arrangement under the Extended Fund Facility (EFF) with Sri Lanka for $ 1.5 billion to support the country’s economic reform agenda.

Minister Karunanayake, who thanked the IMF for its timely assistance, explained in detail the economic targets set by the unity Government. Elaborating on the Government’s fiscal consolidation target, the Minister said that the Government was very clear in gradually reducing the overall fiscal deficit to 3.5% of GDP by 2020.

“We had a budget deficit of 6.7% of the GDP last year and this year’s target will be 5.4%. It will be further reduced to 4.7% in 2017,” the Minister was quoted as saying during the discussion. The Minister also briefed the IMF representatives on the policies and programs undertaken to support adjustment and reforms. Apart from fiscal consolidation, the other areas included under reforms are revenue mobilisation, public financial management and the reforms in State-owned enterprises.

“The IMF mission representatives admired the progress made in the right direction under the reforms agenda. They also expressed hope that the Unity Government of Sri Lanka would be able to achieve the desired economic progress in the near future as stipulated in their reforms agenda,” the statement from the Finance Ministry said. 

The first tranche of the loan was disbursed in June and the rest will be disbursed in five equal tranches, with the next tranche due in November. The reports of the review meeting the Mission Representatives held with Minister Karunanayake in the presence of Treasury Secretary Dr. Samaratunga will be tabled in the IMF November regular meeting enabling the disbursement of the second tranche of the IMF loan.