This bailout was conditional in particular on the guarantees of the Sri Lankan authorities in the fight against corruption, deeply rooted and held partly responsible for the serious economic difficulties of the country, which defaulted on its external debt in April 2022.

The agreement reached in early March with China to restructure its loans to Sri Lanka also paved the way for this financing.

But IMF mission chief Peter Breuer said Tuesday that the government is committed to enacting stronger anti-corruption laws, "which are essential to ensure that the hard-won benefits of reforms benefit the Sri Lankan people."

In a speech, Sri Lankan President Ranil Wickremesinghe announced that the bailout would lift import bans on certain products, imposed due to a shortage of foreign currency.

"The world has accepted that Sri Lanka is no longer a bankrupt country," he said. "Business as normal can resume."

- 'We're screwed' -

Sri Lankans seemed less enthusiastic.

"This is not something we should proudly celebrate," Charlotte Somaseeli, 67, told AFP. "This is a sign of the desperate situation we are in," the retired policewoman added.

"Basically, we're screwed," said Gehard Mendis, a 59-year-old entrepreneur. "The IMF plan is also a loan. This will increase our debt burden."

Colombo had turned to the Washington-based monetary institution, crushed by the weight of its external debt ($46 billion).

This country of 22 million inhabitants has since the pandemic been mired in a serious economic and social crisis that, among other things, caused the resignation and flight of former President Gotabaya Rajapaksa.

His successor Ranil Wickremesinghe led negotiations with the IMF and promised austerity measures to restore public finances.

His decision to raise taxes has already sparked new social tensions, with a nationwide strike launched on March 15, prompting the government to deploy armed soldiers to Colombo's train stations and port.

Sri Lanka, whose economy is based on tea and tourism, is not in its first crisis and has already experienced 16 IMF aid plans since 1965.

"We regularly turn to the fund because we don't seem able to put our house in order," Murtaza Jafferjee of the Colombo-based think tank Advocata Institute told AFP.

"But there is hope because the road trip this time has been of such magnitude, that there will be awareness and there will be lasting changes," he added.

The Indian Ocean island experienced in 2022 its worst economic recession (-7.8%) since its independence in 1948.

© 2023 AFP