COLOMBO: Sri Lanka’s tough austerity measures were “bearing fruit” and must be maintained, the International Monetary Fund said on Friday (October 4) as the country’s new president requested modifications to its US$2.9 billion bailout package.
Anura Kumara Dissanayake, a leftist politician, won last month’s presidential election on a promise to reverse severe tax increases, improve public servant pay, and renegotiate an unpopular IMF bailout Colombo received last year.
On Friday, the self-proclaimed Marxist met with IMF personnel for the second time in a row, according to his office.
“President Dissanayake aims to achieve the objectives of the program in partnership with the IMF, seeking alternative approaches that will alleviate the burden on the citizens,” according to the announcement. Dissanayake stated during his first meeting with the IMF mission on Thursday that he wants to cut the tax burden on lower-income households.
In response, the Washington-based lender highlighted the need of not jeopardising Sri Lanka’s hard-won economic recovery.
“Reform efforts are bearing fruit in terms of reviving economic growth, lowering inflation, boosting reserves, and improving revenue mobilisation,” spokesman Julie Kozack said in Washington.
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