World Bank’s IFC to provide Lanka with $400 mn financing

The World Bank’s investment arm, International Finance Corporation (IFC), has said it will provide Sri Lanka a $400 million cross-currency swap facility to help fund essential imports, agency reports said.

Three private banks, which together deal with over 30% of Sri Lanka’s remittances and exports, will receive the facility to fund essential imports, including medicine, food and fertiliser, the IFC said in a statement on Monday (27).

The funds will provide a much needed foreign exchange cushion for Sri Lanka, which is grappling with its worst financial crisis, in over seven decades, partly triggered by a severe shortage of dollars.

“We expect this financing to boost confidence in the investor community, attract fresh capital inflows to support the Sri Lankan economy,” said Joon Young Park, IFC’s Portfolio Manager, Financial Institutions Group for South Asia.

IFC is also working on further plans to support client banks with other long-term funding and advisory services in the future, the statement added.