Another Dollar loan from IMF

IMF - International Monetary Fund

Sri Lanka is likely to apply for another dollar loan from the International Monitory Fund (IMF) after the last tranche of US$ 1.5 billion was paid in late 2019, Treasury Secretary Dr. R.H.S. Samaratunga said yesterday.

Dr. Samaratunga said two teams of top officials from the IMF and Millennium Challenge Corporation (MCC) are due in mid February to finalize the future programmes and the 5th tranche of the US$ 1.5 billion loan from the IMF and to conclude discussion on the US$ 450 (Rs. 87 billion) grant pledged by the MCC in September.

The Chief Operation Officer of the MCC, Brock Bierman conveyed the message of the approval of the US$ 450 million compact running to five years when he called on President Sirisena, who was in New York attending the United Nations General Assembly in September.

However, the grant was put on hold by the MCC after the change of government on October 26.

The government is confident that it could renegotiate the MCC grant as the US government is satisfied with the turn of events that took place since the restoration of the legitimate government with Mr. Ranil Wickremesinghe as the Prime Minister.

The MCC compact was expected to be presented to MCC’s Board of Directors for approval by late 2018 and will fund entirely through grants which do not need to be repaid. The proposed MCC Sri Lanka Compact was designed to spur economic growth and investment by the private sector to reduce poverty and increase economic opportunities for its people.

The MCC grant to Sri Lanka would be allocated after the US congress approved segment that allocates funds to the MCC and this is expected in a week or so and added funds are approved in the US on sectoral basis.

The government expects to use the grant on infrastructure development projects, especially in the transport, land, road development, bus modernization, control of traffic congestion and traffic management etc.

The MCC is a bilateral United States foreign aid agency established in 2004.

Dr. Samaratunga returned home after a successful visit to IMF and MCC in Washington with Finance Minister Mangala Samaraweera at the weekend. Minister Samaraweera will be back today.

(Source: Daily Mirror – By Sandun A Jayasekera)