COLOMBO: Crisis-hit Sri Lanka has reached a preliminary agreement with the International Monetary Fund (IMF) for a loan of about $2.9 billion, the international lender said in a statement on Thursday.

“The objectives of Sri Lanka’s new Fund-supported programme are to restore macroeconomic stability and debt sustainability,” the statement said, outlining the 48-month long arrangement under the IMF’s Extended Fund Facility.

“Debt relief from Sri Lanka’s creditors and additional financing from multilateral partners will be required to help ensure debt sustainability and close financing gaps,” the statement added.

Crisis-hit Sri Lanka’s inflation hits another record

The debt-laden country has been seeking up to $3 billion from the IMF in a bid to escape its worst economic crisis since independence from Britain in 1948.

Sri Lankans have faced acute shortages of fuel and other basic goods for months, leaving it in political turmoil and hit by runaway inflation, which is now at almost 65% year-on-year.