Sri Lanka’s economy is showing significant signs of recovery, according to Peter Breuer, the International Monetary Fund’s (IMF) Senior Mission Chief for Sri Lanka.
Speaking at a press conference following the IMF Executive Board’s completion of the third review of Sri Lanka’s Extended Fund Facility (EFF) program, Breuer highlighted the country’s impressive strides in overcoming the economic crisis that gripped it in recent years.
Breuer commended Sri Lanka’s progress, stating that the nation has already reached about half of its economic targets set under the EFF program. This, he noted, is a remarkable achievement and an encouraging sign of the country’s recovery.
“Reserves have increased significantly under the EFF program, and the progress made is very impressive,” Breuer remarked, emphasizing that Sri Lanka’s economic outlook is becoming increasingly positive.
Reflecting on Sri Lanka’s dire situation when he first visited in June 2022, Breuer painted a stark picture of the challenges the country faced. “At that time, people were waiting in long lines for fuel, cooking gas, food, and medication. Economic activity was subdued, and Sri Lanka had lost about 10% of its economic activity due to the crisis,” Breuer recalled.
However, in the time since the implementation of the EFF program in 2023, Sri Lanka has made remarkable progress. Breuer revealed that Sri Lanka has already recovered 40% of the economic activity lost over the preceding five years, with the most recent growth figure reaching an impressive 5.5%.
“This is a very significant recovery,” he said. “The economic turnaround is clear, and this will have a positive impact on critical indicators such as poverty levels.”
As Sri Lanka continues to bounce back, Breuer noted that the country’s improved economic prospects would lead to greater opportunities, higher incomes, and reduced poverty.
He also suggested that these improvements would make Sri Lanka a more attractive place to live and work, reversing the trend of emigration. “As economic opportunities return to Sri Lanka, people will be more likely to stay and contribute to the economy. Those who have left the country will also find new opportunities to return,” Breuer added.