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The IMF and Sri Lankan authorities have agreed on economic policies for the first review of a 48-month Extended Fund Facility (EFF) arrangement. Once approved by the IMF Management and Executive Board, Sri Lanka will receive $330 million in financing. The staff-level agreement depends on the authorities' implementation of prior actions and debt restructuring progress. Sri Lanka has made commendable reform efforts, with economic stabilization evident but full recovery uncertain. Key challenges include resolving debt restructuring and restoring business confidence. The IMF emphasizes the need for official creditors to agree on debt treatment, strengthening governance, and addressing corruption risks for economic confidence and inclusive growth.
