IMF staff concludes visit to Sri Lanka to discuss progress of economic program

Notes economic reforms implemented by authorities bearing fruit, with growth outperforming, inflation progressing to target, external reserves accumulating, and fiscal revenues improving

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• Insists sustaining reform momentum is critical to safeguarding macroeconomic stability, entrenching recovery and building resilience to shocks amid trade policy uncertainty and geopolitical tensions

• Highlights progress in meeting key commitments under IMF-supported program will be formally assessed in context of fifth review of EFF arrangement

AN International Monetary Fund (IMF) mission team led by Mission Chief for Sri Lanka Papageorgiou, visited Colombo during 21-25 July, to discuss recent macroeconomic developments and progress in implementing economic and financial policies under the authorities' economic reform program supported by the IMF's Extended Fund Facility (EFF) arrangement.

At the end of the mission, Papageorgiou issued the following statement:

“The Sri Lankan authorities’ economic reform program is yielding commendable outcomes. Real GDP grew by 4.8% y/y in 2025Q1, outperforming expectations. Headline inflation was at -1.1% year-on-year in second quarter of 2025 and is gradually returning to target. Gross international reserves stood at $ 6 billion at end-June 2025, while tax revenue collection continued improving, supported by strong performance in VAT and taxes on imported motor vehicles.