Washington, DC: The Executive Board of the International Monetary Fund (IMF) approved today a 48‑month extended arrangement under the Extended Fund Facility (EFF) with an amount of SDR 2.286 billion (395 percent of quota or about US$3 billion).

The Executive Board of the International Monetary Fund (IMF) will consider Sri Lanka’s bailout package for approval today, exactly 200 days after reaching a staff level agreement.

Former Finance Minister Ravi Kar-unanayake yesterday said Sri Lanka’s deal with the Inter-national Monetary Fund to unlock the $ 2.9 billion Extended Fund Facility (EFF) will be mainly building international reserves to meet external payments and support of macroeconomic adjustment and structural reform programs amidst economic and political crises. Karunanayake, who in 2019 effectively handled $ 1.5 billion IMF bailout deal to boost foreign exchange reserves and avert a balance of payments problem, noted that it will be a catalyst to generate additional international financial assistance in three ways

The Joint Apparel Association Forum (JAAF) yesterday said it welcomes the progress made by the Sri Lankan authorities in securing financing assurances from China, India and the Paris Club creditors, paving the way for the IMF (International Monetary Fund) to consider approval of the long-awaited $ 2.9 billion bailout package.

Hot on the heels of the worst ever contraction of 7.8% in 2022, the economy’s struggle is persisting and recovery remains most challenging this year as well judging by the latest update from the Purchasing Managers Indices.

Disputing the grim forecast of Sri Lanka’s exchange rate by Fitch Solutions by the year-end, Central Bank Governor Dr. Nandalal Weerasinghe raised concerns on the basis of the forecast while stressing that such long-term predictions on exchange rate are not prudent.

The new Monetary Law Act, which aims to grant independence to the Central Bank with enhanced accountability, will empower the monetary authority to make unpopular but essential decisions in prioritising price stability in the country under a flexible inflation target framework, a top official said.

Sri Lanka’s economy suffered its worst fall in 2022, with the GDP contracting 7.8 percent as the further quarter economic growth clocked in at negative 12.4 percent.

Sri Lanka’s rupee is set to decline and lose almost a fourth of its value against the dollar by end-2023, according to. Bloomberg report.