Did Sri Lankan Officials Provide False Information to the IMF?

07-Jul-2025

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The International Monetary Fund (IMF) has taken note of Sri Lanka’s breaches of commitments under the Extended Fund Facility (EFF) programme and the provision of inaccurate information by Sri Lankan officials.

However, the IMF has stated that the submission of false information was not deliberate and has decided not to pursue further action.

Following discussions among the IMF’s Executive Board, Deputy Managing Director and Acting Chair Kenji Okamura issued a statement:
“The Executive Board reviewed Sri Lanka’s breaches of commitments made under the EFF in 2023, including noncompliant procurement and violations under Article VIII, Section 5 of the IMF Articles of Agreement.

Due to inaccurate information provided by officials during the first, second, and third reviews of the EFF, procurement occurred that did not conform to agreed procedures.

The inaccurate reporting was not intentional but arose from weaknesses in timely reporting by the Ministry of Finance and other agencies, and misinterpretation of the definition of ‘arrears’ under the technical Memorandum of Understanding.

Corrective actions taken by authorities—redirecting arrears into the current budget framework and strengthening public financial management practices in line with new legislation—were positively considered by the Executive Board.

Accordingly, the Executive Board granted waivers for nonobservance of performance criteria and determined that no further action would be taken regarding breaches of obligations under Article VIII, Section 5,” the statement said.