COLOMBO: The World Bank has agreed to provide Sri Lanka with $600 million in financial support to enable the country meet payment obligations for vital imports, according to a statement released by the president’s media office on Tuesday.

According to the statement, “the World Bank has agreed to offer $600 million in financial support to solve the current economic crisis.”

The World Bank said it would deliver $400 million “shortly.”
The World Bank said in a statement that it will continue to assist Sri Lanka in overcoming its current economic difficulties.

Sri Lanka’s greatest financial crisis since independence in 1948 was triggered by a 70 percent reduction in reserves over the last two years, reaching $1.93 billion at the end of March. As a result, Colombo has been unable to pay for basic necessities including as fuel, medicines, and food.

Sri Lanka began talks with the International Monetary Fund (IMF) for financial assistance earlier this month. Sri Lanka requires $3-$4 billion in bridge funding to help fulfil its necessary expenses before the IMF finalises a programme for the country.

The Sri Lankan government has also requested bridge money from a number of countries and international organisations until the IMF can provide assistance.

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Sri Lanka has received $1.9 billion in aid from India, and Colombo is in talks with New Delhi for an additional $1.5 billion to cover imports, especially petroleum.

Sri Lanka is also in talks with China over a syndicated loan of up to $1 billion.

Sri Lanka’s Finance Minister, Ali Sabry, stated that the Asian Development Bank would be approached for assistance.

Earlier this month, the country stated that some of its foreign debt repayments would be suspended, and that it would use its meagre reserves to support necessary imports such as fuel, cooking gas, and medicine.