Sri Lanka resumes bailout discussions with IMF

Sri Lanka has resumed technical discussions with the International Monetary Fund on a potential bailout after the new government took office, according to a report by Reuters.Discussions with the multilateral lender started in April under former President Gotabaya Rajapaksa. The Sri Lankan government hopes to secure an Extended Fund Facility (EFF) – which would be conditional on making economic reforms – to help battle the worst economic crisis since independence in 1948, Reuters said.

Ranil Wickremesinghe was appointed as acting president on July 13 after Rajapaksa was ousted by a popular uprising following months of severe shortages of fuel, food and medicines.Wickremesinghe, who served six terms as prime minister, also hopes to restructure Sri Lanka’s debt.

The talks with IMF were highly successful and Sri Lanka is working with advisers to reach consensus on a deal with creditors, the government said.Sri Lanka has $12 billion overseas debt with private creditors. It defaulted on a bond payment earlier this year and is struggling to pay for imports of basic goods, Reuters report stated.