Economy 2 MIN READ

Sri Lanka to retain ‘middle-income’ status but seek concessional loans

October 11, 2022By Reuters

Sri Lanka will remain a middle-income country but request the World Bank to grant it some loans generally offered to poorer nations, the president’s office said on Tuesday, clarifying a cabinet spokesperson’s earlier comments on the matter.

The island nation of 22 million is facing its worst economic crisis in more than seven decades and the spokesperson said earlier in the day that the government would seek to change its economic status to “low income country” for easier funding.

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

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

The IDA is an arm 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. It said it would continue its discussions with Sri Lanka and that the “key priority” was to move ahead with debt restructuring and economic reforms to put the country’s growth back on track.


(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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