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IMF reviews progress as Sri Lanka stresses economic resilience amid ...
Sri Lanka has made steady progress under the International Monetary Fund Extended Fund Facility (EFF) programme, with the fifth and sixth reviews now under close assessment, informed officials said following high-level discussions held at the Presidential Secretariat yesterday. A visiting delegation led by IMF Mission Chief for Sri Lanka Evan Papageorgiou met President Anura Kumara Dissanayake and senior government leaders to evaluate the country’s performance against key reform benchmarks, including fiscal consolidation, revenue mobilisation and external sector stability. “Informed officials indicated that Sri Lanka has demonstrated notable resilience despite a challenging global environment,” sources familiar with the discussions told The Island Financial Review. “There has been measurable progress in stabilising macroeconomic conditions, particularly in terms of rebuilding foreign reserves and strengthening public finance management.” The talks focused extensively on maintaining the current reform momentum, with both sides acknowledging that policy consistency would be critical to sustaining recent gains. “Officials emphasised that the economy is now in a more shock-resilient position compared to the height of the crisis,” a senior source said. “However, they also cautioned that this stability remains fragile and requires continued fiscal discipline and structural reforms.” Particular attention was paid to Sri Lanka’s revenue performance, which has been a cornerstone of the IMF-supported programme. “The improvement in revenue collection has been a key positive,” an official noted. “It reflects both policy measures and better administration, but sustaining this trajectory will be essential to meeting programme targets.” The discussions also addressed the buildup of foreign reserves, a critical buffer against external vulnerabilities. “Rebuilding reserves has strengthened confidence,” another official said. “It provides a degree of insulation against global shocks, although the country is not yet fully out of risk territory.” Officials acknowledged that emerging geopolitical tensions—particularly the ongoing instability in the Middle East—pose a fresh external challenge. “The impact from the Middle East situation is unavoidable,” a source said. “Higher energy prices and supply uncertainties are already exerting pressure, and these factors could affect inflation and the balance of payments.” In response, the government has prioritised targeted relief measu...
Governor Nandalal Acknowledges Over-Optimism, Commits to IMF Path ...
In a marked shift from earlier optimism, Central Bank Governor Nandalal Weerasinghe has adopted a more measured and pragmatic stance as Sri Lanka confronts a fragile recovery and rising global uncertainty. With geopolitical tensions in the Middle East threatening energy markets and global stability, his evolving posture signals a deeper recognition of the risks that lie ahead. Sri Lanka’s economic collapse in 2022 was not merely a financial crisis it was a systemic breakdown that triggered political instability, social unrest, and a loss of institutional credibility. Today, the memory of that collapse continues to shape policymaking at the highest levels. Weerasinghe’s recent acknowledgment that the recovery path may be harder than initially expected reflects a broader recalibration within the country’s economic leadership. The emphasis has shifted from reassurance to resilience, from optimism to discipline. At the core of this approach is an unwavering commitment to the IMF-supported reform programme. While the measures—tight monetary policy, fiscal consolidation, and structural reforms have imposed significant hardship on the public, they are increasingly being framed as essential safeguards against a repeat of past failures. The added complication now is the external environment. Escalating tensions in the Middle East pose a direct threat to energy-importing economies like Sri Lanka. A sustained increase in oil prices or disruption to supply routes could rapidly erode foreign reserves and destabilize the currency. In this context, Weerasinghe’s policy direction reflects a strategic awareness of global risk dynamics. His approach prioritizes reserve accumulation, controlled import demand, and monetary discipline tools designed not just for recovery, but for shock absorption. Critically, the Central Bank’s posture today is also about restoring confidence both domestically and internationally. Investors, creditors, and multilateral institutions are closely watching whether Sri Lanka can maintain policy consistency under pressure. Unlike in the lead-up to the 2022 crisis, when policy missteps compounded vulnerabilities, the current framework is built around predictability and adherence to external benchmarks. This alignment with international financial institutions is not without controversy, particularly given the social cost of reforms, but it has provided a degree of credibility that was previously absent. There is also a broader institutional lesson at ...
Chamber of Commerce flags risks in proposed tax amendments
Chamber of Commerce flags risks in proposed tax amendments Hiru News Most visited website in Sri Lanka,Sri Lanka Latest news updates from Sri Lanka. Sri Lanka News updates and discussions.
Tax Bill provisions risk denting competitiveness, warns Ceylon Chamber ...
The Ceylon Chamber of Commerce (CCC) has flagged key risks in the proposed Inland Revenue (Amendment) Bill of 2026 and cautioned that several provisions could strain financing, compliance and ...
