The Asian Development Bank (ADB) has confirmed the allocation of a $200 million loan to assist in Sri Lanka's economic recovery efforts. This financial aid is aimed at stabilizing the country's financial sector, with a particular focus on promoting inclusive business financing, especially for women-led micro, small, and medium-sized enterprises (MSMEs).
The ADB's initiative comes as Sri Lanka continues to grapple with an economic crisis that led to over $83 billion in bankruptcy declared last April. The nation is currently awaiting the International Monetary Fund's (IMF) approval for a $334 million segment of a larger $2.9 billion bailout package. The IMF has set conditions such as improved tax administration and debt restructuring before releasing funds.
Despite some alleviation of issues like shortages of essential goods and electricity supply, public discontent is on the rise due to new tax impositions and increased utility bills. These measures have been introduced by the government as part of its fiscal recovery strategy.
Takafumi Kadono from the ADB highlighted that their support aligns with national objectives to establish financial stability and prepare for economic recovery following the tumultuous events of last year, which included widespread protests and the ousting of President Gotabaya Rajapaksa.
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