The International Monetary Fund’s Executive Board yesterday approved a lifeline for Sri Lanka saying its 3 billion dollar, four year Extended Fund Facility arrangement will deliver stability and stimulate much needed growth.

In a press release, the IMF said Sri Lanka has been hit hard by a catastrophic economic and humanitarian crisis.

The economy is facing significant challenges stemming from pre-existing vulnerabilities and policy missteps in the lead up to the crisis, further aggravated by a series of external shocks.

The EFF-supported program aims to restore Sri Lanka’s macroeconomic stability and debt sustainability, mitigate the economic impact on the poor and vulnerable, safeguard financial sector stability, and strengthen governance and growth potential.

The Executive Board’s decision will enable an immediate disbursement equivalent to about 333 million dollars and catalyze financial support from other development partners.