NEW YORK: The Worldwide Financial Fund (IMF) says Sri Lanka must tighten its financial coverage to include rising inflation, put its excessive debt repayments on monitor and reverse one of many worst monetary crises the nation has confronted in years.
In a so-called Article IV evaluate, the primary since 2018, the IMF harassed the urgency of implementing a reputable technique to revive the nation’s macroeconomic stability and scale back debt.
It instructed that Sri Lankan authorities ought to reform state-owned enterprises and undertake cost-recovery power pricing.
Sri Lanka’s reserves have plunged 70% since 2020.
They dwindled to US$2.36bil (RM9.89bil) on the finish of January.
However the island has debt repayments of about US$4bil (RM16.76bil) this 12 months.
This features a US$1bil (RM4.19bil) worldwide sovereign bond maturing in July.
The greenback score shortage has prompted some analysts and businesses to warn of a possible default.
The international change scarcity has additionally left Sri Lanka unable to afford important imports of gasoline, medication and meals.
The nation solely has gasoline for a number of days, prompting motorists to line up at pumps and the island’s energy regulator to approve five-hour energy cuts.
Sri Lanka has to date resisted calls to begin talks with the IMF on a program that would reassure traders and ultimately assist it regain entry to worldwide capital markets to repay its debt, after a number of downgrades during the last two years. — Reuters