As part of its efforts to stabilise its flagging economy, Sri Lanka has secured agreements to obtain USD 300 million from the Manila-based Asian Development Bank (ADB) to strengthen its finances, especially its tourism programme.
In a press release by the country’s finance ministry, it was revealed that the funds will be disbursed in three tranches of USD 100 million each for financial sector stability and reform, macroeconomic resilience and transparency, and a sustainable tourism sector development programme aimed at developing and expanding the tourism potential in the eastern port district of Trincomalee and around the UNESCO World Heritage Site of Sigiriya in the Central Province.
The sustainable tourism development initiative will include both a policy-based loan and an investment loan.
The island nation has been battling a severe financial crisis that gripped it in 2022, leading to depleted foreign reserves, high inflation, loan defaults and widespread shortages apart from political turmoil.
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It is implementing reforms under an International Monetary Fund (IMF)-supported programme while seeking support from multilateral agencies such as Manila-headquartered ADB and the World Bank to restore macroeconomic stability and revive growth.
The latest loan approval by the ADB will help support Sri Lanka’s financial sector stability and reforms programme to strengthen the regulatory capacity of the Central Bank of Sri Lanka, while the macroeconomic resilience programme will support broader macroeconomic and public financial management reforms, the ministry said.
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