COLOMBO  – Sri Lanka President Anura Kumara Dissanayake met the members of the International Monetary Fund (IMF) delegation which is in Colombo for the third review of a $3 billion bailout package.

Sri Lanka’s economy has stabilized since it declared sovereign debt default in 2022 but is still facing uncertainty due to local vulnerabilities and debt restructuring.

The IMF delegation is in Colombo to complete the third review of the loan program before approving the disbursement of the fourth tranche.

“Met with the IMF delegation today (18) to discuss Sri Lanka’s economic recovery,” Dissanayake said on his X platform, adding, “I stressed the need for a balanced approach that addresses citizen hardships and restores public trust. Our focus: tackling child poverty, and malnutrition, supporting the differently abled, and fighting corruption with stringent reforms.”

In a separate statement, the President’s Media Division (PMD) said Dissanayake assured that under his leadership, social spending allocations would be utilized effectively, with priority given to combating child poverty and malnutrition and providing better support for differently abled individuals.

“The IMF delegation noted that allocations for social spending had not been fully utilized previously, prompting President Dissanayake to pledge proactive measures to ensure efficient allocation and utilization of resources,” the PMD said.

It noted that governance and anti-corruption were also central to the discussions, with the President reiterating his administration’s commitment to the fight against corruption, a key component of the mandate granted by the people.

He had also assured the IMF team that his government would implement stringent laws to enhance the legislative and institutional structures to uphold transparency and accountability.

The PMD said the meeting marked a positive step forward in the collaboration between the government and the IMF, laying the groundwork for a coordinated effort toward economic recovery and long-term stability.

Dissanayake’s ruling National People’s Power (NPP) in the past has said it wants to renegotiate the IMF loan to reduce taxes and increase concessions.

However, government officials who are aware of the IMF deals said the government will have very little space to manoeuvre with the economy.

“If you change even one simple policy, we might face the risk of going back to the 2022 economic crisis soon,” said an official who has been with the IMF meetings in the past.

-economynext.com