INSUBCONTINENT EXCLUSIVE:
The International Monetary Fund on Tuesday offered to revise the terms of a $2.9 billion bailout loan to cash-strapped Sri Lanka, should the
United States reinstate punitive tariffs on exports.The administration of US President Donald Trump this month imposed a 44 percent tariff
on imports, including garments and rubber, from the South Asian island nation, which is struggling to recover from its economic meltdown in
2022.The prohibitive tariffs have been suspended by Washington for 90 days, and Colombo is in talks to have them removed, but there has been
authorities to assess the impact of those shocks, and we will support the country in formulating specific policy responses within the
single market, accounting for almost a quarter of its $12 billion in merchandise exports.The trade balance is heavily in favour of
Colombo.Sri Lanka secured a $2.9 billion, four-year loan from the IMF after running out of foreign exchange to finance even the most
essential imports, such as food, fuel and medicines, in 2022.Sri Lanka had reported its first full year of economic expansion since its
unprecedented crisis in 2022 when the US tariff announcement was made.The final quarter of 2024 saw the economy expand by 5.4 percent,
performance was in 2022 when GDP shrank by 7.3 percent.Months of shortages in early 2022 led to street protests that eventually toppled
then-president Gotabaya Rajapaksa.His successor, Ranil Wickremesinghe, doubled taxes, cut subsidies, raised prices and went on to lose his
re-election bid in September.The IMF said the new administration, led by President Anura Kumara Dissanayake, was committed to reforms and
raising revenue in line with the bailout.Source: AFP--Agencies
