The International Monetary Fund (IMF) has approved a nearly $3 billion bailout for Sri Lanka, which could help the country unlock up to $7 billion more from other lenders such as the World Bank and the Asian Development Bank.
Here are some key developments in the island nation’s worst economic crisis in about 75 years.
2022
MARCH 31: Demonstrators march to President Gotabaya Rajapaksa’s private residence to protest over worsening economic conditions.
MAY 9: Following widespread clashes between pro- and anti-government protesters, Prime Minister Mahinda Rajapaksa, the president’s elder brother, resigns. Countrywide violence leaves nine dead and about 300 injured.
MAY 18: Sri Lanka falls into default after a 30-day grace period on a $78 million coupon payment expires.
JULY 13: After protesters storm his office and residence, President Gotabaya Rajapaksa flees Sri Lanka, initially going to the Maldives, before moving on to Singapore.
JULY 15: Parliament accepts Gotabaya Rajapaksa’s resignation. Ranil Wickremesinghe, a six-time prime minister, is sworn in as acting president.
JULY 15: Sri Lankan lawmakers vote in Wickremesinghe as the new president.
AUG 9: The country’s power regulator approves a 75% hike in power tariffs.
SEPT 1: Sri Lanka reaches a preliminary agreement with the IMF for a loan of about $2.9 billion.
NOV 14: Sri Lanka’s budget lays down several measures, including reducing the government’s deficit in its efforts to secure the IMF bailout.
2023
JAN 17: India tells the IMF that it will support Sri Lanka’s debt restructuring plan. (ALSO READ: ‘Blood is thicker than water’: S Jaishankar on India-Sri Lanka relations)
JAN 24: Reuters reports the Export-Import Bank of China had offered Sri Lanka a two-year moratorium on its debt and said it would support the country’s efforts to secure the IMF loan. A Sri Lankan source it is not enough to secure an IMF deal.
FEB 7: The Paris Club of creditors gives financing assurances to support the IMF’s approval of an extended fund facility for Sri Lanka.
FEB 8: Sri Lanka’s economy is expected to grow again from the end of this year and the government hopes the country will emerge from an economic crisis by 2026, the president said, as hundreds protested a rise of up to 36% in income taxes amid high inflation.
FEB 16: The country raises electricity prices by 66%.
FEB 21: Government data shows Sri Lanka’s National Consumer Price Index eased year-on-year to 53.2% in January, after a 59.2% rise in December.
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MARCH 8: The Export-Import Bank of China tells Sri Lanka it will try to finalise in the months ahead how it treats debt owed by the crisis-hit nation, according to a letter seen by Reuters, which also reiterated a moratorium for debt due in 2022 and 2023.
MARCH 20: The IMF says its executive board approved a nearly $3 billion bailout for Sri Lanka. The decision will allow an immediate disbursement of about $333 million.