The International Monetary Fund (IMF) has praised Sri Lanka for its continued progress under the economic reform program, noting strong growth momentum as the country recovers from its recent economic crisis.
During a press briefing on the latest regional economic outlook, IMF Asia and Pacific Department Director Krishna Srinivasan and Deputy Director Thomas Helbling provided updates on Sri Lanka’s performance and policy priorities.
Helbling stated that Sri Lanka is now reaping the benefits of implementing its IMF-supported program after facing a severe recession. “After a deep recession during the crisis, Sri Lanka has now implemented the program and is benefiting from very strong growth — 5% last year, with an estimated 4.2% this year and next year, moving toward a potential growth rate of around 3%,” he said.
He emphasized that maintaining the reform program is key to sustaining these gains. “The key advice is to continue with program implementation, realize the full benefits of reforms, and ensure growth remains on track. For Sri Lanka, it’s important to stay on the path of stabilization,” he added.
Helbling further underscored the importance of macroeconomic stability and strong institutional frameworks. “Fiscal consolidation is crucial. Ensuring the financial viability of state-owned enterprises and reducing fiscal risks are essential to sustaining the recovery,” he said.
Echoing this view, Srinivasan commended Sri Lanka’s remarkable turnaround. “Sri Lanka has come a long way from where it was just a few years ago. Our message is to stay the course. The country has already done the difficult part — by continuing reforms, you will continue to see the benefits,” he said.
Helbling also noted that while multiple factors contributed to the previous crisis, the focus should now be on improving governance and policy institutions. “The key is to establish a strong institutional framework for both macroeconomic policy and governance. Public investment management and fiscal frameworks are vital components of this effort,” he observed.
He acknowledged the government’s commitment to governance reforms, citing “impressive progress” in meeting structural benchmarks. “On electricity pricing and cost recovery, reforms are ongoing under the program. Restoring and maintaining fiscal discipline, as well as reforming state-owned enterprises, are crucial steps going forward,” he added.
Commenting on potential price adjustments, Helbling said these depend on factors such as climate conditions and global energy prices but confirmed that the government remains strongly supportive of the reform agenda.
Concluding the briefing, both IMF officials reaffirmed their support for Sri Lanka’s reform efforts, stressing that staying the course is essential for ensuring sustained growth, fiscal stability, and long-term economic resilience.
