The UK opposition MPs have expressed concern about the British government's decision last month provide £6.6 million to the Sri Lankan government which will include funds towards military reform without sufficient clarity on what sort of reform is expected.

A senior US official will visit Sri Lanka between December 14 and 16 and will visit the North-East.

Ambassador Thomas Shannon, Counselor of the Department of State, will travel to the island with Deputy Assistant Secretary for South Asia Manpreet Singh Anand.

The Executive Board of the International Monetary Fund (IMF) said there was continued weakness in the structure of Sri Lanka’s public finances and cited “reasons for concern” as it concluded the Fourth Post-Program Monitoring.

In a press release on Wednesday the IMF said Sri Lanka’s “economic outlook remains uncertain, and will depend to a large extent on the course set for economic policies in the coming months”.

“Deterioration in the overall balance of payments, the loss of central bank foreign exchange reserves, the weak state of public finances, and growing public debt are reasons for concern,” said the statement.

“Despite continued access to international debt markets, these trends suggest that financial risks for Sri Lanka have increased,” it added. “To mitigate these risks, the authorities should take appropriate corrective actions to safeguard macroeconomic stability and lay the foundation for durable and inclusive growth. Improvements in the business climate, reform of state owned enterprises, and a more open trade regime are key to boosting competitiveness and growth.”