News report

Sri Lanka will retain its ‘middle-income country’ status but seek concessional loans

COLOMBO, Oct 11 (Reuters) – Sri Lanka will remain a middle-income country but is asking the World Bank to grant it some loans typically offered to poorer countries, the president’s office said on Tuesday, clarifying earlier comments by a cabinet spokesperson on the matter.

The island nation of 22 million is facing its worst economic crisis in more than seven decades and the spokesman said earlier today that the government would seek to change its economic status to a “low-income country” to easier financing.

President Ranil Wickremesinghe’s office, however, said the status change would not happen.

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“Sri Lanka will remain a middle-income country,” the office said in a statement. “We will ask the World Bank to grant the country eligibility for loans offered by the International Development Association (IDA).”

IDA is a branch of the World Bank that helps the world’s poorest countries.

The local World Bank office in Colombo had no immediate comment on the Sri Lankan request. He said he would continue discussions with Sri Lanka and that the “key priority” was to move forward with debt restructuring and economic reforms to get the country’s growth back on track.

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Reporting by Uditha Jayasinghe in Colombo and Tanvi Mehta in New Delhi; Editing by Tom Hogue, Robert Birsel and Raju Gopalakrishnan

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