The Executive Board of the International Monetary Fund (IMF) completed the third review under the 48-month Extended Fund Facility (EFF) Arrangement, allowing the authorities to draw SDR 254 million (about US$334 million). This brings the total IMF financial support disbursed so far to SDR 1.02 billion (about US$1.34 billion).^[1]

The EFF arrangement for Sri Lanka was approved by the Executive Board on March 20, 2023  in an amount of SDR 2.286 billion (395 percent of quota or about US$3 billion. The program supports Sri Lanka’s efforts to restore and maintain macroeconomic stability and debt sustainability while protecting the poor and vulnerable, rebuild external buffers, and enhance growth-oriented structural reforms including by strengthening governance.

Following the Executive Board discussion on Sri Lanka, Mr. Kenji Okamura, Deputy Managing Director, issued the following statement:

“Reforms in Sri Lanka are bearing fruit and the economic recovery has been remarkable. Inflation remains low, revenue collection is improving, and reserves continue to accumulate. Economic growth averaged 4.3 percent since growth resumed in the third quarter of 2023. By end-2024, Sri Lanka’s real GDP is estimated to have recovered 40 percent of its loss incurred between 2018 and 2023. The recovery is expected to continue in 2025. As the economy is still vulnerable, it is critical to sustain the reform momentum to ensure macroeconomic stability and debt sustainability, and promote long-term inclusive growth. There is no room for policy errors.

“Program performance has been strong with all quantitative targets met, except for the indicative target on social spending. Most structural benchmarks due by end-January 2025 were either met or implemented with delay.

“Sustained revenue mobilization is crucial to restoring fiscal sustainability and ensuring that the government can continue to provide essential services. Boosting tax compliance and refraining from tax exemptions are key to maintaining support for economic reforms. To ease economic hardship and ensure the poor and vulnerable can participate in Sri Lanka’s recovery it is important to meet social spending targets and continue with reforms of the social safety net. Going forward, social support needs to be well-targeted towards the most disadvantaged so as to promote inclusive growth with limited fiscal space. Restoring cost-recovery electricity pricing without delay is needed to contain fiscal risks from state-owned enterprises. A smoother execution of capital spending within the fiscal envelope would foster medium-term growth.

“The progress to advance the debt restructuring to restore Sri Lanka’s debt sustainability is noteworthy. The recent successful completion of the bond exchange is a major milestone towards restoring debt sustainability. Timely finalization of bilateral agreements with creditors in the Official Creditor Committee and with remaining creditors is a priority now.

“Monetary policy should prioritize maintaining price stability, supported by sustained commitment to prohibit monetary financing and safeguard Central Bank independence. Continued exchange rate flexibility and gradually phasing out the balance of payments measures remain critical to rebuild external buffers and facilitate rebalancing.

“Resolving non-performing loans, strengthening governance and oversight of state-owned banks, and improving the insolvency and resolution frameworks are important priorities to revive credit growth and support the economic recovery.

“Prolonged structural challenges need to be addressed to unlock Sri Lanka’s long-term potential, including steadfast implementation of the governance reforms.”

Dilmah, a global Sri Lankan tea brand, continues to drive transformation in the tea industry through its Stronger Together initiative — a platform to foster collaboration, sustainability, and shared progress across the entire tea supply chain, a company news release said.

“Launched in 2023, Stronger Together is a commitment by Dilmah and its parent company, MJF Group, to elevate industry standards, align with global sustainability benchmarks, and support all stakeholders linked to the tea industry. The programme facilitates knowledge-sharing and strategic partnerships, ensuring that suppliers, logistics providers, and allied sectors move forward together in embracing sustainability,” it said.

“As part of this ongoing effort, Dilmah hosted its latest Stronger Together knowledge-sharing session on February 27, 2025, at its headquarters, bringing together over 100 stakeholders from key sectors, including shipping, packaging, IT, HR, and other allied services. Supply chain sustainability thought leaders and key representatives driving strong sustainability initiatives in their organizations, including KPMG and DHL, addressed the audience.”

Dilmah Chairman/CEO Dilhan C. Fernando speaking at the event

The release explained that in striving to achieve net-zero, Dilmah Tea along with its subsidiaries, has committed to align with Science Based Targets initiative to reduce emissions company-wide. Therefore, a priority is supply chain sustainability, which accounts for 80% of its emissions. The Stronger Together event took place a few days after the announcement of the European Commission’s ‘Omnibus Simplification Package’, which proposes to ease sustainability reporting burdens for businesses by delaying certain deadlines and simplifying requirements for regulations like the CSRD and CSDDD, while still maintaining the EU’s overall sustainability goals.

Dilhan C. Fernando, Chairman / CEO of Dilmah Ceylon Tea Company, said: “It is sustainability that is the strength and resilience of our organisation and industry, and it is sustainability that will deliver the competitive edge for all of us.”

Dr Ravi Fernando, Chairman and CEO of Global Strategic Corporate Sustainability and Non-Executive, Independent Director, Dilmah Ceylon Tea Company PLC presented on ‘Future Sustainability/ ESG Trends & Benefits of Global Alignment’ where he took the audience through the European Green Deal policy which will strongly impact Sri Lankan exporters.

At the gathering, Dilmah also highlighted its Supplier Partner Code of Conduct and announced the introduction of an online self-assessment tool that is in the works. The code sets seven supply chain principles to ensure stakeholders adhere to ethical and environmentally responsible practices throughout the entire product life cycle, including aspects like labour standards, waste management, resource usage, and community impact, aiming to minimize negative environmental and social consequences across the supply chain. While the self-assessment tool could prove beneficial for suppliers to identify their gaps in compliance and be a steppingstone for moving towards sustainability by helping them quantify their emissions.

The need for global sustainability regulations, climate change vulnerability, rising market demand for sustainable products, and the need for supply chain collaboration necessitate increased education and awareness. This will ensure regulatory compliance, build climate resilience, enhances market competitiveness, and fosters a unified approach to sustainability. It is essential for Sri Lanka’s tea industry to adopt such practices to maintain its leadership position globally, secure long-term economic growth, and ensure the well-being of workers and the environment, the release concluded.

Senaro Motor Company (Pvt) Ltd. marked 22 years of innovation in Sri Lanka’s automotive industry with the inauguration of its flagship Senaro Experience Lounge in Colombo and the launch of the Senaro Click 150 scooter on January 30, 2025. The event, held at Senaro’s Union Place headquarters, was attended by notable figures, including Bank of Ceylon Chairman Kavinda De Zoysa.

Since its founding in 2003, Senaro has grown from a motorcycle importer to a comprehensive automotive provider. A key milestone was securing a manufacturing and assembly license from the Sri Lankan government, reflecting its commitment to local production and economic growth. The new lounge and scooter launch further solidify Senaro’s position as a market leader.