Treasury receives US $ 695mn under IMF bailout programme following the successful completion of the latest reviews under Sri Lanka’s International Monetary Fund-supported reform agenda. The latest disbursement further strengthens the country’s external finances and supports ongoing economic recovery efforts.
Treasury receives US $ 695mn under IMF bailout programme after IMF review approval
Sri Lanka has received US$ 695 million from the International Monetary Fund (IMF) after the completion of the fifth and sixth reviews of its Extended Fund Facility (EFF) arrangement, according to the Ministry of Finance. The latest funding represents a significant milestone in the country’s four-year economic reform programme aimed at restoring macroeconomic stability and rebuilding investor confidence.
Finance and Planning Deputy Minister Dr. Anil Jayantha Fernando said the Treasury had received the sixth and seventh tranches under the IMF programme, bringing total disbursements received by Sri Lanka to more than US$ 2.4 billion since the bailout package was approved.
The latest funding comes at a time when the Sri Lankan economy is navigating a challenging external environment. Rising global oil prices and increased import demand linked to the conflict in the Middle East have placed renewed pressure on the local currency in recent weeks. Authorities have repeatedly emphasized that exchange rate flexibility remains a key element of the IMF-backed reform framework.
Speaking on the latest development, Dr. Fernando said the receipt of funds would contribute to strengthening Sri Lanka foreign reserves, which remain an important buffer against external economic shocks. He also rejected criticism surrounding the recent depreciation of the rupee, arguing that the country’s economic fundamentals have improved significantly compared to the conditions that prevailed during the height of the economic crisis.
According to the Deputy Minister, the government’s commitment to implementing agreed reforms under the IMF Extended Fund Facility has helped rebuild economic resilience and improve Sri Lanka’s ability to absorb external pressures.
“The country’s economy has reached a level where it can absorb economic shocks, particularly those arising from the conflict in the Middle East and recent adverse weather events,” Dr. Fernando said in a statement issued by the Ministry of Finance.
He noted that the government has simultaneously expanded assistance programmes for vulnerable communities affected by economic challenges and natural disasters. Around Rs. 500 billion has been allocated to address disaster-related impacts, while Rs. 100 billion had previously been earmarked to mitigate economic pressures associated with developments in the Middle East. More recently, the Cabinet approved an additional Rs. 20 billion for relief measures.
The latest IMF disbursement highlights continued international confidence in Sri Lanka’s reform programme, which was launched following the country’s unprecedented economic crisis. Since entering the IMF Extended Fund Facility, Sri Lanka has undertaken a series of fiscal, monetary, and structural reforms aimed at restoring debt sustainability, improving governance, and strengthening public finances.
The IMF Executive Board last week approved the combined fifth and sixth reviews of Sri Lanka’s EFF arrangement, enabling the immediate release of approximately US$ 350 million. With the latest payment, total IMF financial assistance under the programme has risen to around US$ 2.44 billion.
Meanwhile, IMF Resident Representative for Sri Lanka Martha Tesfaye Woldemichael met with Dr. Fernando at the Ministry of Finance to discuss ongoing engagement under the reform programme and review progress on policy implementation.
Economic analysts note that maintaining momentum in reforms will be crucial for sustaining economic recovery and preserving access to international financial support. Strengthening Sri Lanka foreign reserves, improving fiscal discipline, and enhancing investor confidence remain key priorities as the country continues its recovery journey.
As Treasury receives US $ 695mn under IMF bailout programme, policymakers are expected to focus on sustaining reform efforts while managing external risks, including global commodity price volatility and geopolitical uncertainties. The latest funding provides additional support for Sri Lanka’s stabilization strategy and reinforces the importance of continued cooperation with international financial institutions.