The economic situation in debt-stricken Sri Lanka has started to gradually improve following its worst economic crisis two years ago, the International Monetary Fund (IMF) has said.
Inflation has come down from a peak of 70 percent in 2022 to 5.9 percent last month and the country’s economy expanded in the second half of last year following a year and a half of contraction, the IMF said on Thursday.
Sri Lanka’s year-on-year economic expansion in the third quarter of 2023 was 1.6 percent, and in the fourth quarter 4.5 percent, the IMF said.
The economic crisis in early 2022 left Sri Lankans suffering from severe shortages of food, medicine, fuel and power, drawing strident protests that led to the removal of then-President Gotabaya Rajapaksa.
The Indian Ocean island nation declared bankruptcy in April 2022 with more than $83bn in debt – more than half of it to foreign creditors.
Sri Lanka turned to the IMF for help to rescue the economy and secured a bailout package last year.
