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IMF seeks more reforms in Sri Lanka prior to loan review

The International Monetary Fund (IMF) on Monday said it would be postponing the planned review of its $1.5 billion three year loan, until after Sri Lanka had instituted further reforms. 

The IMF urged Sri Lanka to tighten its monetary political and continue fiscal consolidation. The review is now to scheduled to take place after the government submits its 2018 budget. 

"Incorporating the new Inland Revenue Act, the 2018 budget should continue fiscal consolidation supported by stronger revenues," the IMF said in a statement.

"The Central Bank should stand ready to head off pressures on inflation and credit growth, while continuing to enhance exchange rate flexibility."

“The authorities have been improving the country’s fiscal position and strengthened its international reserves, but more needs to be done in the area of state owned enterprises reforms."

"Upholding the reform momentum will be important for addressing fiscal and external imbalances and meeting the government's ambitious social and development objectives." 

"Renewed effort toward bolstering competitiveness, improving social protection programs, and boosting private sector development will be important for making growth more robust and inclusive.”