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The
economy of the country of 22 million is expected to shrink 2%
this year before returning to growth next year, the government
estimates, following last year's record contraction of 7.8%
after foreign exchange reserves hit record lows.
The International Monetary Fund approved a bailout of nearly $3
billion in March, which Sri Lanka expects will bring additional
funding of up to $4 billion from the World Bank, the Asian
Development Bank and other multilateral agencies.
Of the proposed World Bank funding, $500 million will be for
budgetary support and is likely to come in two tranches of $250
million each, one of the sources, from the World Bank, said.
All four sources, from the World Bank and the Sri Lankan finance
ministry, sought anonymity as they were not authorised to talk
to the media.
The first tranche is likely to be disbursed immediately after
board approval with the next possibly in October, as the bank
watches the progress of Sri Lanka's debt restructuring and the
first review of the IMF programme, due in September, the World
Bank source added.
The remaining $200 million will be earmarked for programmes to
assist the poor, whose numbers have doubled to 25% of the
population since the onset of the Indian Ocean nation's worst
economic crisis early last year, another World Bank source said.
"Households that have registered for support will be ranked ...
and the lowest 2 million will be eligible for support," the
source added.
The World Bank and the finance ministry did not immediately
respond to requests for comment.
(Reporting by Uditha Jayasinghe; Editing by Krishna N. Das)
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