Sri Lanka not actively pursuing IMF option: CB Governor

Governor_of_the_Central_Bank_Arjuna_Mahendran

Sept 30, 2015 (LBO) -Sri Lanka is not actively pursuing funding from the International Monetary Fund, the Central Bank Governor Arjuna Mahendran told Lanka Business Online.

“The IMF is always available. I wouldn’t say that was something we were actively pursuing. There is no need for it as we have sufficient reserves,” he said.

“But there are several sources that are possible,” he said referring to bilateral and multilateral financing.

According to him, the next key step is the November 20th budget as budget proposals are likely to stimulate significant private sector and donor interest in the island.

“At this stage, we are talking to them (IMF) in terms of keeping our relationship intact and giving other investors comfort that the IMF is solidly behind us,” said Mahendran.

“But in terms of actually applying for an IMF package, that is really a last resort and there is nothing on the table at the moment.”

The trade deficit has begun to narrow, according to figures for July, and “that in a sense pre-dates our macro-prudential measures we announced and currency liberalization in September. Reserves are on a positive track,” he said.

Earlier, Finance Minister Ravi Karunanayake told Lanka Business Online that any funding from the IMF would be “on our terms” and it was an option to be considered only if necessary, after the budget.