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Sri Lanka seeks IMF and World Bank borrowings

Press Trust of India  |  Colombo 

The new Sri Lankan government hopes to raise USD 4 billion from the International Monetary Fund and the World Bank, Finance Minister Ravi Karunanayake said today.

"With the new government in place, there is a lot of international goodwill. We would love to have an enhanced programme with the IMF for balance of payments support," Karunanayake said, adding, he would himself travel to Washington next week for talks aimed at raising this amount.

The finance minister further said that the new government was keen to enhance its investments in the island's health and education sectors.

In 2009, the previous Mahinda Rajapaksa government was boosted by an IMF bail-out of USD 2.6 billion when faced with a balance of payments crisis at the end of war with the LTTE.

However, Karunanayake was critical of the Rajapaksa government for borrowing at a high cost from China.

"In some case, the interest rate on Chinese loans is as high as eight per cent," Karunanayake said, adding "where possible, we want to renegotiate and reduce the rate".

Sri Lanka has enjoyed high economic growth rates since the armed conflict with the LTTE came to an end.

Karunanayake's party then in opposition claimed growth figures were doctored by the Rajapaksa government to portray a healthy economy.

First Published: Thu, February 12 2015. 21:35 IST