Sri Lanka may not need IMF money: economic minister

L to R: Samantha Ranatunga, Chairman, HVA Foods PLC; Jan Müggenburg, Chief Executive Officer, Müggenburg Group; Graham Stork, Chief Executive Officer, HVA Foods PLC; Sarva Ameresekere, Group Chairman, George Steuart & Co. Ltd.

Jan 30, 2012 (LBO) - Sri Lanka may not need the remaining 800 million dollars of International Monetary Fund money since reserves are still high, economic development minister Basil Rajapaksa said.

"When we borrow the money it goes into monetary reserves and they have to be invested in another country, for a small difference in interest rates," minister Rajapaksa told reporters Monday.

"Since we already have foreign exchange reserves of around six to seven billion US dollars, economic specialists are discussing it at the moment, whether it is really needed."

An IMF mission is currently in the country to conduct a review of the paused program.

The final two tranches under a 2.
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5 billion US dollar bailout loan was held back in mid 2011 by the IMF who asked the Central Bank not to defend a rupee peg, amid soaring credit growth.

Sri Lanka has lost about two billion US dollars from a peak of 8.


1 billion US dollars in July and sterilization of dollar sales pushed credit to a new high in November.

Minister Rajapaksa said the current IMF program was the longest the country had successfully followed and previous programs had been aborted even earlier.

The IMF has commended the

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