President Anura Kumara Dissanayake says the Government has appointed a committee to assess Sri Lanka's future engagement with the International Monetary Fund (IMF) following the conclusion of the current Extended Fund Facility (EFF) programme in March 2027.

Delivering the 2027 Budget speech in Parliament, the President said the Government was committed to successfully completing the existing IMF programme while continuing to strengthen the country's foreign exchange reserves.

He said the Government would assess whether a new arrangement with the IMF would be necessary after March 2027 and, if so, determine the most suitable type of agreement for the country. A committee has already been appointed to evaluate the available options.

The President also announced that public debt is projected to decline to 87 per cent of Gross Domestic Product (GDP) by 2032, exceeding the Government's initial target under the IMF programme.

He explained that the Government had initially set a target of reducing public debt to 95 per cent of GDP by 2032 under the IMF programme. However, according to the IMF's Sixth Review, if current economic trends continue, the debt burden could decline further to 87 per cent of GDP by 2032.

President Dissanayake further stated that the Government was implementing necessary reforms to broaden the tax base, streamline tax exemptions and digitise tax administration.

Emphasising the need for public sector reform, President Dissanayake said the existing state machinery needed to be transformed to meet the country's future development requirements.

He stressed that the country could not achieve the desired transformation through the traditional state machinery and called for a stronger, more efficient and effective public administration.

The President also underscored the importance of maintaining fiscal discipline and sustainable public finances.

He said the Government aimed to maintain a primary budget surplus of 2.3 per cent while keeping the overall budget deficit at 5 per cent.

He further highlighted the need to continue implementing the Public Financial Management Act to strengthen fiscal accountability and improve the management of public resources.

The President said Government expenditure was expected to reach 13.6 per cent, while public investment was projected at 4 per cent of GDP.

He said the Government's economic reform agenda would focus on maintaining fiscal stability, strengthening public institutions and creating the necessary conditions for sustainable economic development.