20 May, 2024


Stock Market Booms Following IMF Loan

The usually dreary Colombo Stock Market was a hive of activity today, as the All Share Price Index crossed the 6500 mark, moving up 58 points, following the announcement of a US $ 1.5 billion bail-out from the International Monetary Fund (IMF).

IMF’s chief for Sri Lanka, Todd Schneider

IMF’s chief for Sri Lanka, Todd Schneider

The IMF today agreed to a US $ 1.5 billion loan for Sri Lanka in support of economic reforms aimed at reversing a two-decade decline in tax revenue and reviving growth. IMF’s chief for Sri Lanka, Todd Schneider, said an agreement was reached to release $1.5 billion over a three-year period in support of the country’s reform agenda.

“I am pleased to announce that, in support of the government’s economic reform agenda, the Sri Lankan authorities and the IMF have reached a staff-level agreement on a 36-month Extended Fund Facility (EFF) for 185 percent of Sri Lanka’s quota in the IMF (about SDR 1.1 billion or US$1.5 billion). This agreement will be subject to completion of prior actions and approval by the IMF’s Executive Board, which is expected to consider Sri Lanka’s request in early June. Formal approval of the EFF is expected to catalyze an additional US$650 million in other multilateral and bilateral loans, bringing total support to about $2.2 billion (over and above existing financing arrangements),” he said.

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  • 2

    This is akin to an impotant man getting excited over a goose bump on his member in the nether regions.

    • 1

      The Colombo stock market is the Casino of the corrupt and rich.
      The fact is that Sri Lanka will soon be in a Greece like Situation, with ever mounting debt and the rupee only temporarily stabilized, as the corrupt insider trader at the Central Bank, Arjuna Mahendran, is on a BORROWING AND SPENDING SPREE with IMF assistance, without any plan to reduce the national debt and stop the crash of the rupee.

      Instead of borrowing from IMF, the priority should be tracking down the Tax defaulters listed in the Panama Papers and other lists of overseas bank accounts and bringing those funds back to pay the national debt, but IMF turns a blind eye and PROMOTED financial corruption and political greed, while paying lip service to “good governance”.

      It is a mystery that IMF is seen as a solution to Sri Lanka’s debt crisis, when it is part of the problem of legalized financial corruption, overseas tax havens and the shadow economy of the wealthy that generates and massive economic INEQUALITY, poverty, conflict and violence.

      Remember the social and political unrest caused by the IMF which watched the looting of the Greek economy by capitalists and then forced austerity on the poor, further causing INEQUALITY and poverty?

      The IMF’s AID CONDITIONALITIES totally ignores and promotes CORRUPTION and the way political corruption of the Ranil-Sira government has exacerbated and magnified the crisis due to appointment of corrupt and incompetent people to manage economy – Ravi K. and Arjuna Mahendran who are Ranil’s cronies.

      Rani-Sira should ask IMF and The World Bank that calls itself the Knowledge Bank (HA, HA) to help them to go through Panama Papers and other off show accounts corruption lists and investigate and track down the stolen and looted funds of corrupt Sri Lanka politicians in off Show bank accounts? These looted funds would be enough to pay off the national debt.

      If the looted funds stolen by the former SL dictator Mahinda Jarapassa and his brothers, sons, cronies, including Nivard Cabraal, are brought back to Sri Lanka the country would be able to pay its massive national debt and stop the crash of the rupee..

      But the knowledge produced at World Bank and IMF is really to legalize corruption and the flight of capital and looting of the global south to the global north and institutionalized global and national INEQUALITY and poverty.

      Why do you think 63 individuals today control over half the world’s wealth as reveal by OXFAM at the rich man’s club meet in Davos?!

  • 1

    Finally good news – move forward PM, President and Fin Min,.

  • 1

    Sunday May 1st 2016

    » News » Three benefits from IMF deal for SL’s external financing profile – Moody’s
    Three benefits from IMF deal for SL’s external financing profile – Moody’s
    April 30, 2016, 8:46 pm

    Sri Lanka’s 1.5 billion US dollars deal announced with the IMF will have three benefits for Sri Lanka’s external financing profile, Moody’s Investors Service said in a statement.

    Marie Diron, Senior Vice President, Sovereign Risk Group, Moody’s Investors Service, and the lead sovereign analyst for Sri Lanka highlighted the three points below.

    Well done Mr.President,Honourable Prime Minister,Finance Minister and CB Governer for bringing back investor confidence to Sri Lanka.
    Ranil your diplomacy did great for the country and as Mahathir did for Malaysia or Lee Kwan You did for Singapore you are our best hope for putting our nation best on track.Of course the IMF bail out may have some inconvenience for the people but the people should also realise that you had no alternative due to the policies of the previous government.
    All the nation now needs is PATIENCE as there is definitely light at the end of the tunnel
    Move on Ranil the nation is with you.Every dark cloud has a silver lining.

    Firstly, program disbursements together with forthcoming multilateral and bilateral loans will provide external liquidity to ease immediate financing pressures.

    Secondly, the financing will likely be at more favorable terms than Sri Lanka can avail of through the market, which alleviates debt servicing cost pressures.

    Thirdly, if the agreement restores investor confidence in Sri Lanka’s policy framework, it could ultimately support more stable private external inflows, such as foreign direct investment.

    • 2

      “”Thirdly, if the agreement restores investor confidence in Sri Lanka’s policy framework, it could ultimately support more stable private external inflows, such as foreign direct investment.””

      with all the paranoia of GMOA and other professionals about India are about to conquer us.
      If India decides to return into the market $1.5 billion swap (it was against RBI policy)
      Hi 5 Lanka would be back to the foxes hole- Husband Is Village Idiot

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