Sri Lanka receives $695 million IMF tranche as reforms earn praise

Sri Lanka’s Treasury has drawn a $695 million tranche from the International Monetary Fund following the completion of the programme’s fifth and sixth reviews. The disbursement brings total IMF support to roughly $2.4 billion. The IMF Executive Board described the country’s performance as “generally strong” despite global pressures such as the Middle‑East conflict and the aftermath of Cyclone Ditwah. The Fund projects economic growth to slow to about 3 % in 2026 from 5 % in 2025, with inflation expected near 5 % and a return to a current‑account deficit.

In a separate statement the IMF praised Sri Lanka’s turnaround, highlighting improvements in revenue collection, exchange‑rate stability and tighter fiscal discipline. Reforms cited include tax changes, fuel and electricity pricing adjustments and public‑finance restructuring. While investor confidence is expected to rise, the Fund warned that poverty, living‑cost pressures and implementation hurdles remain, and future tranches will depend on continued programme compliance.