The International Monetary Fund (IMF) on Monday said its executive board has approved a nearly $3 billion bailout for Sri Lanka, potentially helping the country emerge from its worst financial crisis in over seven decades.

Sri Lankan President Ranil Wickremesinghe's office said the decision will enable the country to access up to $7 billion in funding overall.

The IMF program will help improve Sri Lanka's standing in international capital markets, the president's office said.

Also Read: Global recession may not be on the cards; India a bright spot, says Kristalina Georgieva

Kristalina Georgieva, managing director, said, "Sri Lanka has been facing tremendous economic and social challenges with a severe recession amid high inflation, depleted reserves, an unsustainable public debt, and heightened financial sector vulnerabilities.

Institutions and governance frameworks require deep reforms. For Sri Lanka to overcome the crisis, swift and timely implementation of the EFF-supported program with strong ownership for the reforms is critical."

"It is now essential to continue the reform momentum under strong ownership by the authorities and the Sri Lankan people more broadly," Peter Breuer and Masahiro Nozaki, Senior Missionn Chief and Mission Chief for Sri Lanka said.

"It is now important for the Sri Lankan authorities and creditors to closely coordinate and make swift progress towards a debt treatment that restores debt sustainability under the EFF-supported program," they were quoted as saying.

Lastly, the statement further said that there is great emphasis on Sri Lankan authorities and creditors to closely coordinate and make swift progress towards a debt treatment that restores debt sustainability under the EFF-supported program.

First Published:Mar 20, 2023 11:27 PM IST