Question

The World Bank has declared that it does not plan to offer new financing to Sri Lanka, which is battling its worst economic crisis in decades, until the country has an adequate macroeconomic policy framework in place. In a statement, the World Bank said Sri Lanka needed to adopt structural reforms that focus on economic stabilisation and tackle the root causes of its crisis. The latter has starved it of foreign exchange and led to shortages of food, fuel, and medicines. The bank is repurposing resources under existing loans to help alleviate shortages of essential items such as medicine, cooking gas, fertiliser, meals for children, and cash for vulnerable households.
Based only on the above passage, which one of the following statements can be inferred with certainty?

• A. According to the World Bank, the root cause of Sri Lanka’s economic crisis is that it does not have enough foreign exchange.
• B. The World Bank has stated that it will advise the Sri Lankan government about how to tackle the root causes of its economic crisis.
• C. According to the World Bank, Sri Lanka does not yet have an adequate macroeconomic policy framework.
• D. The World Bank has stated that it will provide Sri Lanka with additional funds for essentials such as food, fuel, and medicines.

Hint:

In inference questions, watch for words that signal necessity or timing (“until”, “does not plan to”) and distinguish {causes} from {effects}. Also, “repurposing existing funds” $\neq$ “providing additional funds.”

Answer 1

The Correct Option is C

Why (C) is certain.
The first sentence says the Bank “does not plan to offer new financing … until the country has an adequate macroeconomic policy framework in place.” This implies the required framework is not yet in place. Therefore it follows with certainty that, according to the World Bank, Sri Lanka does not yet have an adequate macroeconomic policy framework.
Why the others are not entailed.
(A) The passage distinguishes between root causes and their effects: it says the crisis “has starved it of foreign exchange…”. So, lack of foreign exchange is presented as a consequence, not the root cause. Hence (A) overstates.
(B) The Bank “said Sri Lanka needed to adopt structural reforms” (a recommendation), but it never states it will advise the government (an explicit future action/engagement). Not guaranteed.
(D) The Bank is repurposing resources under existing loans—not providing additional (new) funds. Thus (D) contradicts the stated “does not plan to offer new financing.”
\[ \boxed{\text{Therefore, only (C) follows with certainty.}} \]