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 stabilization 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:

Pay attention to the specific details in a passage and avoid over-interpreting beyond the text. Inference should always be based on direct facts presented.

Answer 1

The Correct Option is A, B

- From the passage, the World Bank clearly mentions that Sri Lanka's crisis is due to a lack of foreign exchange, leading to shortages in essential supplies. This directly points to statement (A).
- Statement (C) is partially correct but not explicitly confirmed by the passage. The statement about structural reforms suggests that Sri Lanka does not yet have a sufficient policy framework, but it is not conclusively stated.