Sri Lankan Loan Is Cleared by the IMF

by sudharaka | July 24, 2009 at 07:55 pm

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Despite the efforts of the the "self appointed international community", a lobby consists mainly of the countries that used to tolerate the financing and supporting of the [now extinct] LTTE, a terrorist group which is ironically has been blacklisted by them on paper, as well as various other groups who have dubious interests, the International Monetary Fund has approved the much talked about $2.6 billion financial facility to Sri Lanka.

WASHINGTON -- The International Monetary Fund approved a $2.6 billion loan to Sri Lanka, despite opposition by the U.S., Britain and France, which were concerned about human-rights violations and skeptical of Sri Lanka's commitment to change.

The IMF doesn't take specific votes from its member countries on loan programs, which are regularly approved by consensus. Instead, countries "abstain" from approvals -- and even that is done rarely. The last time Britain abstained, for instance, was in 2004, concerning a measure related to Argentina. Several other countries also abstained in the Sri Lanka vote, IMF officials said.

IMF Managing Director Dominique Strauss-Kahn generally won't push a loan deal that has significant opposition. But in this case, IMF officials said a "clear majority" of the membership backed the loan, particularly Asian countries. A number of IMF members were worried that scrapping the loan, or delaying it much longer, could provoke a financial crisis in Sri Lanka.

The mainly those who opposed (abstained from voting) seems to be skeptical of the "ability and commitment of the government to carry out necessary policy adjustments."

However, Sri Lanka has proved them wrong by elimininating what was labelled as "most ruthless terrorist outfit in the world" by the US FBI in a matter of less than 03 years, with very limited resources, while the NATO led coalition has made a meal of anti-terror operations around the globe, despite having cutting edge technology at their disposal.