Sri Lanka and the International Monetary Fund (IMF) have reached staff-level agreement on economic policies to conclude the combined Fifth and Sixth Reviews of Sri Lanka’s reform program supported by the IMF’s Extended Fund Facility.

Once the review is approved by the IMF Executive Board, Sri Lanka will have access to about US$700 million in financing, the IMF said yesterday in a statement.

Full text of the IMF statement: An International Monetary Fund (IMF) mission team led by Evan Papageorgiou visited Sri Lanka from March 26 to April 9, 2026, to discuss recent macroeconomic developments and progress in implementing economic and financial policies under the Extended Fund Facility (EFF) arrangement. At the end of the mission, Mr. Papageorgiou issued the following statement:

“IMF staff and the Sri Lankan authorities have reached staff-level agreement on the combined Fifth and Sixth Reviews under the 4-year Extended Fund Facility (EFF) arrangement. The arrangement was approved by the IMF Executive Board for a total amount of SDR 2.3 billion (about US$3 billion) on March 20, 2023.

“The staff-level agreement is subject to IMF Executive Board approval, contingent on: (i) the restoration of cost-recovery electricity and fuel pricing while protecting the vulnerable and (ii) the completion of the financing assurances review, to confirm multilateral partners’ financing contributions and assess adequate progress with debt restructuring.

“Upon completion of the Executive Board review, Sri Lanka would have access to SDR 508 million (about US$700 million), bringing the total IMF financial support disbursed under this arrangement to SDR 1,778 million (about US$2.4 billion).

“Sri Lanka’s ambitious reform agenda continues to deliver commendable outcomes. The economy grew by 5 percent y/y in 2025. Inflation has returned to positive territory and rebounded to 2.2 percent y/y in March, and gross official reserves reached US$7 billion in end-March 2026. Fiscal performance in 2025 was strong, primarily supported by taxes on motor vehicle imports. Debt restructuring is nearing completion, with the successful completion of Sri Lankan Airlines’ debt exchange and further progress in finalising remaining bilateral agreements.

“Sri Lanka is significantly exposed to the Middle East conflict, which has heightened energy prices, disrupted a key air hub for tourists, and affected Sri Lankans working in the region. Authorities have ameliorated disruptions to economic activity by securing sufficient fuel supplies for households and industries. At the same time, the country needs to address the infrastructure and spending needs caused by Cyclone Ditwah. Heightened downside risks to the economy from disaster risks,persistent trade policy uncertainty and the conflict in the Middle East emphasize the urgency to accelerate the reform momentum to safeguard macroeconomic stability, enhance Sri Lanka’s resilience to shocks, and maintain the economy on a path toward recovery and inclusive growth.

“On this front, it is important to continue building fiscal space through strong revenue measures and prudent spending execution. This requires sustained efforts to improve tax compliance, broaden the tax base, address revenue leakages, and enhance public financial management. It is instrumental to restore and maintain cost-recovery fuel and electricity pricing while assisting the most vulnerable. Continued vigilance is needed to minimize fiscal risks and safeguard fiscal discipline.

“As Sri Lanka starts building back better, projects should be prioritized judiciously and spending executed transparently and in compliance with the Public Financial Management Act. Any fiscal support in response to exogenous shocks should be well-targeted, carefully costed, and timebound. Protecting the poor and vulnerable, who are disproportionately affected, should remain a priority, and this calls for the steadfast strengthening of social safety nets by improving their targeting, adequacy, coverage, and shock-responsiveness.

“It is important for monetary policy to remain data-dependent and agile to safeguard price stability in the face of shocks. Central bank independence should continue to be upheld, including by continuing to prohibit monetary financing of the budget. Rebuilding foreign reserves while allowing for exchange rate flexibility is a necessity amid global uncertainty. Resolving non-performing loans, promoting sound credit growth, and addressing vulnerabilities in some small licensed finance companies will help safeguard financial stability.

“The publication of the 2026 government action plan on governance reforms is welcome; effective implementation will help advance the anti-corruption agenda and support growth. It will be key to uphold the independence of Sri Lanka’s anti-corruption body (CIABOC), support the reliability of the beneficial ownership registry, and strengthen fiscal governance through sound legislation on public-private partnerships, state-owned enterprises, public procurement, and public asset management. Unlocking strong and durable growth for all Sri Lankans requires staying the course on reforms, including by sustaining trade liberalization efforts, accelerating digitalization initiatives, streamlining business regulations, and modernizing labor legislation to reduce rigidities.

“The IMF team held meetings with President and Finance Minister Anura Kumara Dissanayake, Labor Minister and Deputy Minister of Finance and Planning Prof. Anil Jayantha Fernando, Deputy Minister of Economic Development Nishantha Jayaweera, Central Bank of Sri Lanka Governor Dr. P. Nandalal Weerasinghe, Secretary to the Treasury Dr. Harshana Suriyapperuma, Senior Economic Advisor to the President  Duminda Hulangamuwa, Chief Advisor to the President on Digital Economy Dr. Hans Wijayasuriya, Governor of Southern Province Prof. Susiripala Manawadu, and other senior government and CBSL officials. The IMF team also met with parliamentarians, representatives from the private sector, civil society organizations, and development partners.

“We would like to thank the authorities for the excellent collaboration during the mission, including during our visit to Galle in the Southern Province. We reaffirm our commitment to support Sri Lanka at this uncertain time.”

More than 200,000 micro, small and medium-scale enterprises (SMEs) in Sri Lanka ceased operations between 2018 and 2022, Deputy Minister of Finance and Planning Prof. Anil Jayantha told Parliament yesterday (9).

Prof. Fernando said around 108,000 businesses shut down as a direct result of the economic crisis, while a further 155,000 closures were attributed to other factors. Citing data from the Department of Census and Statistics, the Deputy Minister said there were approximately 1.3 million registered institutions in the country during the 2018–2022 period, of which about 1.037 million remain in operation.

He added that a comprehensive listing of institutions was conducted once every 10 years.

Lankan Australian playwright S Shakthidharan, widely known as Shakthi, has won the $US175,000 ($250,000) Windham-Campbell Prize for drama.The international prize is awarded each year to writers of fiction, non-fiction, poetry and drama for their body of work. Writers are nominated secretly and cannot apply.

Shakthi won the award for his ambitious, multigenerational plays exploring Sri Lankan Tamil migrant experiences, including his debut Counting and Cracking. The play, co-written with Belvoir artistic director Eamon Flack, also won the $100,000 Victorian Prize for Literature in 2020.

Shakthi told ABC Arts he “felt proud our stories can be on that global stage”.

He found out he won via email a few weeks ago while shooting his debut movie The Laugh of Lakshmi, about a mother and son separated by civil war, in Sri Lanka.

“The stories I tell are not the usual stories this country tells,” he said.

“To get that global recognition hopefully puts forward a version of Australia which is a bit more progressive than our current reality here.”

Shakthi added the money also makes it possible for him to continue to pursue a career as a writer.

“I still have to fight hard to do anything in this country,” he said.

“It’s so incredible to be able to write from a place of focusing on the art.”

Writing on Instagram, Shakthi said he was “still in shock” about his win.

“The prize is for an artist’s body of work, he wrote. The judges decide the winners by reading their work. This means a group of strangers overseas — who had never heard of me — were taken in by these stories of Asia and Australia and chose to embrace them.

“I like that. It’s what writing can do: pull you in to the specific, vulnerable, emotional truths of a place and a people you have never encountered before.”

Inspired by Shakthi’s family history, Counting and Cracking went on to tour the UK and New York.

His family was forced to leave Sri Lanka following the 1983 Black July pogrom in Colombo, which killed an estimated 5,600 Tamils.

Speaking to ABC Arts in 2024, when the play opened in Melbourne, Shakthi said making Counting and Cracking helped him and his mother come to terms with their migrant identities.

“To tell the gloriously complex story of your community in full public view, and to have other people embrace that, has been a radical act of belonging.”

In 2022, Shakthi reunited with Flack for The Jungle and the Sea, which explicitly uncovered the toll of the Sri Lankan civil war (1983-2009).

His latest play, The Wrong Gods, about the tension between progress and tradition, and ensuing environmental degradation, opened in Sydney in 2025.

Last year, Shakthi also published his debut memoir, Gather Up Your World in One Long Breath.

He is director and co-founder of Western Sydney theatre company Kurinji.

The Windham-Campbell judges described Shakthi as a “rare storyteller whose work traverses time and space while remaining anchored in core emotional truths”.

Other winners of the Windham-Campbell Prizes this year include British novelist Gwendoline Riley and Belgian American writer Lucy Sante.

Past Australian winners of the prize include author Helen Garner, playwright Patricia Cornelius and poet Ali Cobby Eckermann.(ABC)