Svetlana EkimenkoAll materialsWrite to the authorSri Lanka earlier announced a slew of reforms, including raising taxes, as measures that the International Monetary Fund (IMF) considers essential to secure a bailout package.The International Monetary Fund (IMF) has announced in a statement that it reached a preliminary agreement to provide crisis-hit Sri Lanka with a $2.9Bn bailout over four years.
The island nation of 22 million has been struggling with its worst economic crisis in more than seven decades and seeking an emergency loan from the IMF. Sri Lankans have faced acute shortages of fuel and other basic goods for months, with inflation currently soaring at almost 65% year-on-year.The island nation owes $51 billion to foreign countries, and multilateral institutions.Sri Lanka’s government announced it was implementing reforms, including raising taxes, to bring the economy back on a sustainable public debt path. President Ranil Wickremesinghe, who took over after Gotabaya Rajapaksa fled the country due to a popular uprising in July, had said earlier that negotiations with the IMF had successfully reached their final stage.As he presented an interim budget in the parliament, he said the government had decided to hike taxes despite inflation reaching 60 percent in July.
WorldSri Lanka to Sell Stake of National Carrier to Foreign Investors Amid Talks on IMF Bailout29 August, 14:45 GMTThe government of Sri Lanka has also unveiled its “efficient expenditure management” plans, proposing rationalizing the number of government employees and introducing mandatory retirement of all who reach 60 years of age. Furthermore, the president announced that a new public finance management law was being formulated and a national debt management agency created to improve the fiscal health of the $81 billion economy.Ranil Wickremesinghe, who also heads the finance department, blamed the politicization of economic policies for the personal benefit of the previous government for the collapse of Sri Lankan economy. Wickremesinghe held several rounds of talks with the IMF team.
WorldJapan to Coordinate With Sri Lankan Creditors to Restructure Foreign Debt, Finance Minister Says30 August, 10:18 GMT