Sri Lanka, Sept. 20 -- Sri Lanka might seek a precautionary short-term Stand-By Arrangement (SBA) with the International Monetary Fund (IMF) after its Extended Fund Facility (EFF) programme ends next March, Government sources told Sunday Observer Business.

They said such a successor arrangement would not necessarily mean that Sri Lanka intends to draw IMF funds immediately, but the Government might consider an SBA arrangement of around US$1.5 billion.

"An SBA can function as a protection mechanism, for a country to access resources if an external shock creates a Balance-of-Payments (BoP) crisis, such as the possible effects of El Nino or a continuation of the Middle East crisis," they said.

"The need for a post-programme financing str...