IMF Approves 695 Million Dollars for Sri Lanka Program
The International Monetary Fund approved a 695 million dollar disbursement to bolster Sri Lanka's foreign reserves amid rising energy costs. While the nation grew 5% last year, the IMF warns that Middle East conflict risks have slowed the 2026 growth projection to 3%.
The International Monetary Fund (IMF) approved $695 million in program funding for Sri Lanka on Wednesday. The disbursement is part of a $2.9 billion rescue package aimed at stabilizing the nation’s foreign currency reserves. This liquidity injection is critical as the island nation faces renewed inflationary pressure and external shocks from Middle East instability.
### Reserves Under Pressure from Regional Conflict Foreign currency reserves in Sri Lanka fell 3.8% to $6.7 billion by late April. The decline followed a surge in energy costs linked to the conflict involving the United States, Israel, and Iran. Higher prices for energy imports, including Brent Crude Oil, have strained the country's balance of payments.
