The International Monetary Fund (IMF) has announced that approval for the fourth review of Sri Lanka’s Extended Fund Facility (EFF) programme hinges on the government fulfilling specific prior actions, particularly the restoration of electricity cost recovery pricing.
Speaking at the IMF’s weekly press briefing, Spokesperson Julie Kozack stated that the completion of the review is subject to approval by the IMF Executive Board, with the board meeting expected to take place in the coming weeks.
However, Kozack emphasized that the exact timing of the meeting depends on two key factors. “The first is the implementation of prior actions,” she explained. “The main prior actions relate to restoring electricity cost recovery pricing and ensuring the proper functioning of the automatic electricity price adjustment mechanism.”
The second condition is the completion of the financing assurances review. This review will evaluate whether multilateral partners have confirmed their financing commitments to Sri Lanka and assess progress made in the country’s debt restructuring process.
“In a nutshell, completion of the review is subject to executive board approval. We expect the board meeting to take place in the coming weeks, contingent on these two matters,” Kozack added.
A staff-level agreement on the fourth review was reached between the IMF and Sri Lankan authorities on April 25. Once approved by the executive board, Sri Lanka will gain access to approximately USD 344 million in financing.
