IMF approves US$206 million in emergency funding for Sri Lanka

Vithanage Erandi Kawshalya Madhushani, JadeTimes Staff

V.E.K Madhushani is a Jadetimes news reporter covering Economic

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Image Source -: The Official Government News

The International Monetary Fund (IMF) has approved approximately US$206 million in emergency financial assistance for Sri Lanka under the Rapid Financing Instrument (RFI), aimed at addressing urgent economic pressures caused by Cyclone Ditwah.

The cyclone, which struck on November 28, resulted in the loss of more than 600 lives, displaced over 100,000 people, and caused widespread damage to infrastructure and livelihoods. The disaster has placed significant strain on public finances and the country’s balance of payments.

The Government of Sri Lanka welcomed the IMF’s timely support, noting that the funds will be used to meet immediate humanitarian needs and to support recovery and reconstruction efforts. The government also reaffirmed its commitment to transparency, accountability, and strict adherence to public financial management laws in the use of the assistance, while maintaining fiscal discipline and ensuring debt sustainability.

Due to the time required to fully assess the economic impact of the disaster, the IMF has postponed the Fifth Review of Sri Lanka’s Extended Fund Facility (EFF) programme. Discussions on the review are expected to resume in early 2026.

IMF Deputy Managing Director Kenji Okamura said the emergency funding would help Sri Lanka address urgent humanitarian and reconstruction needs. He added that Sri Lankan authorities remain committed to fiscal prudence, transparency, and the continuation of economic reforms as the country recovers from both the cyclone and its recent financial crisis.