IMF Vows Support As Sri Lanka Maps Its Post‑Cyclone Recovery

COLOMBO (News 1st); A high‑level International Monetary Fund (IMF) delegation led by Evan Papageorgiou concluded a week‑long visit to Colombo on January 28, reopening formal discussions with the Sri Lankan government amid the deepening socio‑economic fallout from Cyclone Ditwah.

The mission, which ran from January 22 to 28, marked the IMF’s first major engagement with Sri Lanka since the devastating storm tore through multiple districts, destroying infrastructure, crippling livelihoods, and amplifying the hardships of already vulnerable communities.

In a detailed statement issued at the end of the visit, Papageorgiou said the team’s primary focus was to understand “the economic and social impact of the cyclone, including the damage to infrastructure and loss of livelihoods.”

According to the IMF, the discussions centred on the government’s fiscal response to the unprecedented natural disaster, as well as the implications for monetary policy and the stability of Sri Lanka’s financial sector—already under pressure from the country’s fragile economic recovery.

The visiting delegation held extensive exchanges on the government’s future policy direction, its urgent financing needs, and the types of support the IMF could extend under the ongoing Extended Fund Facility (EFF).

Papageorgiou emphasized that while rebuilding is essential, Sri Lanka’s recent hard‑won gains in fiscal and debt sustainability must be protected.

The statement underscored the Sri Lankan authorities’ pledge to strengthen public investment management—especially in project prioritization and execution—as reconstruction begins across cyclone‑hit regions.

The IMF also stressed the importance of transparent spending fully aligned with the Public Financial Management Act.

Crucially, the government conveyed its commitment to expanding and reinforcing social safety nets, ensuring the poorest and most vulnerable, those hit hardest by Cyclone Ditwah—receive targeted and timely support.

Signalling an urgency in the IMF–Sri Lanka engagement, Papageorgiou announced that the Fund plans to deploy its next mission “at the earliest possible juncture” to resume discussions for the next EFF review.

He reaffirmed the IMF’s “solidarity with Sri Lanka and readiness to support the country in its efforts to safeguard macroeconomic stability and promote resilience and sustainable growth.”

Papageorgiou concluded by thanking Sri Lankan authorities for their “excellent collaboration during the visit.”