COLOMBO: Sri Lanka’s new chief backed the International Monetary Fund’s (IMF) controversial bailout plan on Thursday (Nov 21), marking a U-turn from his marketing campaign promise to renegotiate the deal reached by his predecessor.
Leftist President Anura Kumara Dissanayake, who final week tightened his grip on energy after profitable a big majority within the legislature following his personal victory in September, has vowed to keep up the IMF program.
Sri Lanka turned to the IMF for a rescue package deal after the nation defaulted on its $46 billion exterior debt in April 2022 throughout an unprecedented financial meltdown.
Foreign alternate shortages that left the nation unable to finance even essentially the most important meals and gasoline imports led to months of road protests and compelled then-President Gotabaya Rajapaksa to resign.
The $2.9 billion mortgage secured early final yr required Colombo to sharply elevate taxes, eradicate beneficiant vitality subsidies and conform to restructure greater than 50 loss-making state enterprises.
Dissanayake’s National People’s Power social gathering mentioned it disagreed with the International Monetary Fund’s debt evaluation and would renegotiate the bailout program.
But in his first speech to the brand new parliament, the place his social gathering enjoys a two-thirds majority, Dissanayake mentioned the financial restoration was too fragile to take dangers.
“The financial system is in such a state that it can not face up to the slightest shock… there is no such thing as a room to make errors,” he mentioned, ruling out negotiations with each the IMF and collectors.
“This shouldn’t be the time to debate whether or not the situations are good or dangerous, whether or not the settlement is favorable to us or not… The course of lasted about two years and we can not begin over again,” he mentioned.
The third delayed assessment of the four-year lending program might be concluded by this weekend, with the Finance Ministry holding talks with an IMF delegation visiting Colombo, he added.
