Sri Lanka will get IMF loan this month

Fund to be used for development:

Lalin Fernandopulle

The Government will receive the IMF loan this month as negotiated and the money will be used for post war development activities in the country, said Minister of State Revenue, Ranjith Siyambalapitiya.

Minister Ranjith Siyambalapitiya

“A decision has not been taken regarding the use of IMF funds to pay for oil hedging deals. Opposition parties are making this accusation to bring the Government into disrepute”, he said. Various political parties and think tanks in the country have been sceptical about the use of the IMF money to offset the losses incurred in the oil hedging deals.

“A Cabinet Sub Committee has been appointed to study the aid utilisation mechanism and ensure no conditions are attached to the loan”, Siyambalapitiya said. “Rehabilitation, resettlement and infrastructure development are the main priorities of the post war development plan of the Government”, the Minister said.

He said defeating terrorism and developing the economy are goals envisaged in the Mahinda Chintana program. The war is coming to an end and a proper environment will be created to develop the country.

“There will be more funds allocated for development activities and the armed forces personnel will be deployed for reconstruction programs. Fishing, agriculture, tourism and the palmyrah industry will be revived”, he said.

Despite the global recession a six percent economic growth rate was achieved last year and with all the gloom a four percent growth rate has been forecast this year. The Central Bank in its annual report 2008 stated that the economy will slide to around 4.5 percent this year. Experts said that the growth rate will be much lesser due to drop in exports.

Economists said that the country’s foreign reserves have depleted and are sufficient only to cover 1.3 months. The over valued rupee is a major obstacle for exports which have dropped to a high degree.