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Sri Lanka has asked the International Monetary Fund (IMF) for immediate financial assistance, and the global lender may consider it after some scepticism, according to an assistant to the country’s finance minister.
Protests have erupted in the island nation as it confronts a terrible financial crisis brought on by COVID-19’s impacts, mishandled government finances, and rising fuel prices, which have depleted foreign reserves.
On Monday, a Sri Lankan delegation led by Finance Minister Ali Sabry began formal talks with the IMF in Washington for a programme that the government believes will assist top up its reserves and attract bridging finance to pay for vital gasoline, food, and medical imports.
“The (foreign minister) requested a Rapid Financing Instrument (RFI) to address current supply chain concerns, but the IMF first believed it didn’t fulfil their requirements,” Sabry’s adviser Shamir Zavahir tweeted.
“However, given to the exceptional circumstances, India also submitted an RFI for (Sri Lanka), and the IMF may take this request into consideration.”
Sri Lanka plans to seek $3 billion in funding from a variety of sources in the coming months, including the IMF, the World Bank, and India, according to Sabry.
The central bank of the country said last week that repayment on part of its foreign debt will be suspended awaiting a reorganisation.
Protests demanding President Gotabaya Rajapaksa’s removal have lasted more than a week in the commercial metropolis of Colombo.
