October 3, 2022

The World Financial institution has agreed to offer Sri Lanka with $600 million in monetary help to assist meet fee necessities for important imports, the Sri Lankan president’s media division mentioned in an announcement on Tuesday.

“The World Financial institution has agreed to offer $600 million in monetary help to deal with the present financial disaster,” the assertion mentioned.

The World Financial institution would launch $400 million “shortly”, it mentioned.

In response to the assertion, the World Financial institution mentioned it could proceed to assist Sri Lanka to beat the present financial disaster.

Sri Lanka’s worst monetary disaster since independence in 1948 was brought on by a drastic drop in its reserves that dropped 70% over the previous two years, hitting $1.93 billion on the finish of March. This left Colombo struggling to pay for necessities, together with gas, medicines and meals.

Earlier this month, Sri Lanka kicked off talks with the Worldwide Financial Fund (IMF) for monetary help. Earlier than the IMF finalises a programme for Sri Lanka, the nation wants $3-$4 billion in bridge financing to assist meet its important bills.

The Sri Lankan authorities has additionally appealed to a number of international locations and multilateral organisations for bridge financing till the IMF comes up with its assist.

India has helped Sri Lanka by helping with $1.9 billion, and Colombo is in talks with New Delhi for an additional $1.5 billion to fund imports, together with gas.

Sri Lanka can be negotiating with China for as much as $1 billion in a syndicated mortgage.

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Sri Lanka’s Finance Minister Ali Sabry mentioned Colombo would additionally search help from the Asian Growth Financial institution.

The nation introduced a suspension on a few of its overseas debt repayments earlier this month and mentioned it could divert its meagre reserves to fund important imports akin to gas, cooking gasoline and medication.

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