Monday, July 27, 2009

IMF defends Sri Lanka loan amid human rights worries

WASHINGTON, July 27 (Reuters) - The International Monetary Fund defended a $2.6 billion loan to Sri Lanka on Monday saying it is aware of human rights concerns by donors but the funding is needed to prevent a devastating balance of payments crisis.

The loan was approved by the IMF board on Friday with opposition from several countries including the United States, Britain, Germany, France and Argentina, which expressed concern at human rights abuses in Sri Lanka.

"In Sri Lanka's case they have been hit by the global crisis and the IMF's mandate is to address and ward off balance of payments crises," IMF mission chief to Sri Lanka, Brian Aitken told reporters on a conference call.

"The balance of payments crisis sounds rather dry but it really would have a devastating impact on the economy and on the people, particularly the most vulnerable," he added.

Aitken said the IMF was in regular contact with humanitarian groups and diplomats over human rights worries.
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