Sri Lanka gets first tranche of IMF bailout

President Ranil Wickremesinghe told parliament on Wednesday that Sri Lanka received the first tranche of an IMF bailout, which was scheduled to receive a US $330 million bailout, the first part of a nearly US $3 billion bailout approved by the International Monetary Fund on Monday.

Wickremesinghe said that this set the stage for Sri Lanka to have better fiscal discipline and better governance.

The International Monetary Fund, the Asian Development Bank, and other lenders are expected to give additional support to the tune of $3.75 billion from the likes of the World Bank, the Asian Development Bank and other lenders. It clears the way for Sri Lanka to rework a large part of its US $84 billion worth of public debt.

State finance minister Shehan Semasinghe said in an interview that Sri Lanka is ready to engage in resolving talks with bilateral and private creditors to recover debt sustainability as soon as possible. This was the 17th IMF bailout for Sri Lanka and the third since the country's decades-long civil war ended in 2009.

Economic mismanagement coupled with the impact of the COVID 19 epidemic left Sri Lanka severely short of dollars for essential imports, leading to the island nation's worst financial crisis in seven decades.