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A team
from the
International
Monetary
Fund has
arrived
Sri
Lanka to
review
progress
under
its $2.6
billion
loan
agreement.
The
visit,
which
began
today,
Sep. 9,
is
expected
to help
clear
the way
for a
second
payment
of $322
million
to Sri
Lanka,
official
sources
said.
The
Washington-based
lender
in July
approved
a
20-month
arrangement
that
immediately
provided
$322
million
to help
Sri
Lanka
rebuild
after
the end
of
almost
three
decades
of war
and
replenish
foreign-exchange
reserves
that
fell to
an
eight-
year low
of $1.27
billion
in
March.
The
island’s
reserves
rose to
a record
$3.9
billion,
aided by
IMF
funds
and
foreign
buying
of
rupee-denominated
debt,
the
Central
Bank has
said.
Reserves
have
climbed
71
percent
in four
months
and are
above
the
level
stipulated
in the
loan
agreement
with the
IMF, the
bank
said
Aug. 4.
In
understandings
with the
IMF
loan,
Sri
Lanka
agreed
to
reduce
its
budget
deficit
to 5
percent
of gross
domestic
product
by 2011,
from 7
percent
this
year,
and
maintain
flexibility
in the
exchange
rate in
order to
build
foreign
reserves
to cover
3 1/2
months
of
imports
and
bolster
the
economy.
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