World Bank approves Sri Lanka's Eligibility for funding request

The World Bank has approved crisis-hit Sri Lanka's request to access concessional financing from the International Development Association so as to help stabilise its economy, the lender said.

Soaring inflation, a weakening currency and low foreign exchange reserves have left the island nation of 22 million struggling to pay for imports of essentials such as food, fuel and medicine.

Through the IDA, Sri Lanka will receive concessional financing, technical assistance, and policy advice from the World Bank to implement reforms towards economic recovery.

Access to IDA's concessional financing would also alleviate debt service pressures as it offers more favourable terms, the World Bank said in a statement.

“We are committed to helping the Sri Lankan people at this time of dire need so their country turns around and restores its economic well-being,” said Akihiko Nishio, World Bank Vice President for Development Finance. “The World Bank is ready to support Sri Lanka as it implements reforms that will reduce poverty and rebuild the economy, creating the foundation for sustainable growth.”

“At this time of critical need in Sri Lanka, we appreciate the World Bank’s rapid response and its vision as the first development partner to respond in record time through repurposing existing operations to help preserve Sri Lankan institutions for basic service delivery,” said Ali Sabry, Hon. Minister of Foreign Affairs of Sri Lanka. “The reverse graduation to IDA will enable us to access resources to help sustain institutions to become more resilient and responsive to the needs of the people of Sri Lanka.”