January 24, 2007 (LBO) – Sri Lanka’s treasury chief said Wednesday that the International Monetary Fund’s decision to close offices in the island was a good sign that the country is moving away from being overly reliant on foreign donors. The Washington based lender will wind up operations later this month, as they have no ongoing lending programme with the fund.
“The IMF gives us balance of payment support, the fact that we have no need to go to them for the last three-years is a good sign. We must be happy that our bankers are not after us,” treasury secretary P B Jayasundara told reporters.
The move was also taken in the context of the overall declining budget available to the IMF to maintain an office in Colombo, he said.
Sri Lanka joined the IMF on Aug 29, 1950, but the global financial watchdog opened a Colombo office in in 1979, when the island signed up for its first structural adjustment facility as it embarked on an ambitious reform program.
The IMF last approved a 567 million dollar poverty reduction growth facility (PRGF) for Sri Lanka in April 2003, but the island drew down only the initial tranche of 80 million dollars in the same month.
The loan has been on hold since November 2003 due to politica