Notes upcoming elections are for the people of Sri Lanka to decide

Puts the questions on Bangladesh and Sri Lanka in one basket

By Sanath Nanayakkare

Sri Lanka needs to allow reforms to continue for a period of time, Julie Kozack, Director of the Communications Department, IMF said on September 12, 2024, according to the transcript of an IMF press briefing.Notably she made this comment while taking questions on Sri Lanka and crisis-hit Bangladesh in combination, during the press conference.

“Okay. Any questions on Sri Lanka or Bangladesh?” she asked, upon which, a questioner posed her the following question.

Question: “I would like to ask about Sri Lanka and whether there is any possibility of reopening the programme negotiations based on the possible results of the September 21 presidential election, and what the elections implications could be for that $3 billion program existing currently with Sri Lanka?”

Julie Kozack: Okay, I’ll start with Sri Lanka. So, just stepping back for a moment.  On June 12th of 2024, our Executive Board completed the 2024 Article IV Consultation and the Second Review of the EFF program.  That provided the country with access of about $336 million U.S. dollars.  Programme performance remains strong.  Reform efforts are bearing fruit.  Economic growth is starting to revive.  Inflation is coming down.  Reserves, international reserves are increasing, and revenue mobilization is improving.  Nonetheless, important vulnerabilities do remain, and sustaining reform momentum is going to be essential.”

“Regarding some of the specific questions about the presidential elections, first, it’s very important to note, of course, that for the upcoming elections, this is really for the people of Sri Lanka to decide, right.  Achieving the programme’s objectives is a key priority to give Sri Lanka a chance to emerge from one of its worst crises in history.  As I’ve already noted, a lot of progress has been made, but the country is not out of the woods yet, and it is important to safeguard those hard-won gains,” she said.

Taking the question on Bangladesh she said,” First, I do want to say that we are deeply saddened by the loss of lives and injuries during the recent protests.  It was very distressing to hear about those losses of lives.  From the IMF side, we are working closely with the interim government.  An IMF team will visit Bangladesh in late September for a fact-finding mission and to discuss recent economic developments, and further details about the Staff visit will be communicated in due course.”

“We remain fully committed to working with Bangladesh in support of the people within the context of the IMF program, we will continue to work closely with the authorities to help advance the reform agenda.  And, of course, as part of the upcoming mission, the team will be assessing all of the economic developments and any potential financing needs in Bangladesh.”