Sri Lanka calls US ‘bully’ over IMF loan delay

After more than three months of delay by the International Monetary Fund in considering Sri Lanka’s urgent request for a $US1.9 billion loan, Sri Lanka labelled the United States obstruction of the loan ‘deplorable’ and publicly accused the super power of being a “bully”.

Speaking at a Colombo seminar organised by the Institute of Policy Studies and the World Bank on Wednesday, July 1, Deputy Finance Minister Sarath Amunugama said: “The US has no business obstructing a project that is technically sound on the basis of its misinformation. This is an unacceptable case of the bullies trying to run the World Bank and the IMF”.

He claimed that “President Obama is very badly misinformed” and “for the first time, in a very ugly way, the US is trying to bring a palpably political agenda into the IMF.”

On June 23, US State Department official Gregg Sullivan said US assistance to Sri Lanka would depend on the government providing access to the war-ravaged north of the country, sending Tamil people back to their homes and allowing aid groups to “operate effectively”.

He insisted that the US “expects the Sri Lankan government to hold accountable those responsible for violations of international humanitarian law”.

Asked by journalists about the IMF funds, Sullivan denied that the US was “threatening to block the loan”. In the same breath, however, he noted that the US “will carefully assess any program in light of the conditions in Sri Lanka at the time.” On the same day, Assistant Secretary of State for South and Central Asia Robert Blake made a similar statement before the US Senate foreign relations committee, adding that the US was pressing Sri Lanka “to engage in political reconciliation with Sri Lanka’s Tamil minority”.

On July 2, however, at a bi-weekly press meeting, IMF spokeswoman Caroline Atkinson indicated that a decision on the loan would be further postponed.

“We don’t have a date for an Executive Board meeting at present on Sri Lanka,” she said, adding that “discussions are continuing” on the loan and that finalisation would “depend on the Executive Board”.

According to Atkinson, Sri Lanka's loan was still pending before the executive board which has yet to set a date to consider the application.