IMF RFI Brings Relief—but Raises Cost Questions
Sri Lanka has secured about US$206 million in rapid financing from the International Monetary Fund under its Rapid Financing Instrument (RFI) following the destruction caused by Cyclone Ditwah. Finance and Planning Deputy Minister Dr. Anil Jayantha Fernando said the facility offers low-interest, transparent emergency funding to ease balance-of-payments pressures and support recovery.
He noted that the current SDR-linked interest rate stands at around 3.27% and that repayment periods range between three and five years. The Government has also introduced temporary loan repayment extensions and concessional credit for affected businesses through licensed banks.
However, analysts caution that IMF lending costs can rise over time due to variable SDR rates and potential surcharges. While the RFI provides short-term liquidity, it adds to external debt and does not address longer-term reconstruction or economic resilience challenges..
