Exclusive-World Bank set to approve $700 million for Sri Lanka next week -sources

FILE PHOTO: A worker cleans a hotel's window, as a national flag waves at a seafront tent camp that became the focal point of months-long nationwide demonstrations, as the deadline police asked protesters to leave the camp is approaching, amid the country's economic crisis, in Colombo, Sri Lanka, August 10, 2022. REUTERS/Kim Kyung-Hoon/File Photo

COLOMBO (Reuters) - The World Bank is likely to approve $700 million in budgetary and welfare support for Sri Lanka at its next board meeting on June 28, sources told Reuters, the biggest funding tranche for the crisis-hit island nation since an IMF deal in March.

The economy of the country of 22 million is expected to shrink 2% this year before returning to growth next year, the government estimates, following last year's record contraction of 7.8% after foreign exchange reserves hit record lows.