In other news, Sri Lanka's ability to access the next IMF tranche of USD 700 million depends on restoring cost-recovery pricing for electricity and fuel. The International Monetary Fund (IMF) announced on Thursday that Sri Lanka’s combined Fifth and Sixth Reviews under the Extended Fund Facility (EFF) need approval from its Executive Board, which is anticipated to meet soon. During a media briefing, IMF Communications Department Director Julie Kozack mentioned that a staff-level agreement was reached between IMF staff and Sri Lankan authorities on April 9. Several conditions must be met before the program can be presented to the Executive Board, including the restoration of cost-recovery pricing for electricity and fuel, measures to protect vulnerable groups, and ensuring financing assurances. Once the Board approves, Sri Lanka could access approximately USD 700 million in funding, Kozack noted. When asked about the government’s fuel subsidy scheme, including the Rs. 100 per litre diesel subsidy, Kozack did not comment directly. However, she emphasized that the program requires both cost-recovery pricing reforms and protections for vulnerable communities. She also pointed out that Sri Lanka has recently faced "two very large shocks," referencing Cyclone Ditwah and the broader external effects of the Middle East conflict, which have impacted the economy and the public. Despite these difficulties, she highlighted that Sri Lanka's reform program is showing positive outcomes, noting strong fiscal performance in 2025, progress in debt restructuring, 5 percent economic growth, and inflation returning to a positive state after a period of deflation. Kozack reiterated the IMF’s commitment to assisting Sri Lanka’s reform efforts, underlining that the organization continues to collaborate closely with the authorities to maintain economic stability and recovery.
