IMF says Sri Lanka needs to boost reforms for its bailout funding package

Colombo, Sri Lanka: Sri Lanka has so far failed to make enough progress in boosting tax collection and other economic reforms for the International Monetary Fund to release a second tranche of $330 million in the country’s $2.9 billion bailout from bankruptcy, the IMF said.

The IMF said in a statement that discussions would continue in an agreement on how to keep up the momentum of reforms, and to unlock the second installment of funding that was due at the end of this month.

“Despite early signs of stabilization, full economic recovery is not yet assured,” the statement said, adding that the country’s accumulation of reserves has slowed due to lower-than-projected gains in the collection of taxes.

“To increase revenues and signal better governance, it is important to strengthen tax administration, remove tax exemptions, and actively eliminate tax evasion,” the statement said.

Image courtesy of ORF

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