The International Development Association (IDA) of the World Bank Group (WBG) has approved a USD 200 million financing package to support the second phase of Sri Lanka’s Resilience, Stability, and Economic Turnaround (RESET) Development Policy Financing (DPF) program. The agreement was signed today (07) by K.M. Mahinda Siriwardana, Secretary to the Ministry of Finance, Economic Development, Policy Formulation, Planning, and Tourism, and David N. Sislen, World Bank Country Director for Sri Lanka, in the presence of President Anura Kumara Dissanayake.
This financing reflects the World Bank’s ongoing commitment to assist Sri Lanka in its comprehensive reform agenda. The RESET DPF program, working alongside the IMF’s Extended Fund Facility (EFF), is designed to address the root causes of the country’s economic crisis. The two-year program (2023–2024) aims to restore stability through macroeconomic adjustments while protecting the poor and vulnerable. In 2023, the first phase successfully secured USD 500 million after achieving seven key prior actions across three pillars.
The three pillars of the RESET DPF program are:
- Improving Economic Governance: Strengthening fiscal discipline, transparency, and accountability in public resource management while safeguarding financial stability.
- Enhancing Growth and Competitiveness: Unlocking Sri Lanka’s growth potential by fostering a more competitive private sector.
- Protecting the Poor and Vulnerable: Safeguarding the most affected segments of society from the economic impact of the crisis.
For the second phase in 2024, the Sri Lankan government plans to utilize the USD 200 million loan from the IDA. To qualify, the government must meet nine prior actions under the three pillars while maintaining a sound macroeconomic policy framework. The World Bank Board has approved the financing, which will take effect upon the signing of the agreement.
This financial assistance is expected to be crucial in stabilizing Sri Lanka’s economy and preventing future crises, while fostering a more inclusive and competitive economic environment.
President’s Media Division (PMD)
