The International Monetary Fund (IMF) has stressed the importance of the 2025 budget aligning with the parameters of the Extended Fund Facility (EFF) program, as the Executive Board prepares for its upcoming review. Ms. Julie Kozack, Director of the Communications Department at the IMF, highlighted this during a recent press briefing.
On November 23rd, 2024, IMF staff and Sri Lankan authorities reached a staff-level agreement on the Third Review of Sri Lanka's EFF program. This agreement, once approved by the IMF's Executive Board, will provide Sri Lanka with access to approximately $333 million in financing. The Board meeting to consider this approval is expected to take place in the coming weeks.
Ms. Kozack took the opportunity to commend Sri Lanka's ambitious reform agenda, which has delivered notable outcomes. "The economy expanded by 5.5 percent in the third quarter of 2024," she remarked. "Average headline and core inflation remained contained well below the target during the fourth quarter of 2024, and international reserves increased to $6.1 billion at the end of 2024."
Regarding the 2025 budget, Ms. Kozack emphasized that the staff-level agreement reached in November is subject to Executive Board approval and contingent upon the implementation of prior actions by Sri Lankan authorities. This includes the submission of a 2025 budget consistent with the parameters identified under the EFF program.