Syrian economy continues to recover with improved consumer, investor sentiment: IMF

The International Monetary Fund (IMF) said Wednesday that the Syrian economy continues to recover, noting that economic activity has accelerated further in recent months, with improved consumer and investor sentiment.

It said an IMF delegation visited Damascus earlier this month to assess economic conditions and discuss the progress of economic reforms, as well as policy priorities and capacity development needs.

The IMF noted that economic activity has gained additional momentum in recent months, supported by improving consumer and investor confidence, the continued return of refugees, increased electricity supply and rainfall, and Syria's ongoing regional integration.

"The IMF's program of engagement aims to support the authorities' efforts to rehabilitate Syria's economy and key economic institutions with policy advice and technical assistance," it said. "This includes extensive support to the Ministry of Finance and to the Central Bank of Syria, as well as improving statistics, which would also help pave the way for the resumption of Article IV consultations with Syria."

Ron van Rooden, who led the delegation, said the economy continues to show signs of recovery, with activity accelerating and consumer and investor confidence steadily improving. He noted that international sanctions have been lifted and the country is reintegrating into regional and global economies.

Van Rooden emphasized that progress toward national reconciliation, the continued return of refugees, rising electricity supply and rainfall, and several large new investment projects are positive signals for growth prospects in 2026 and beyond.

He added that authorities are preparing the 2026 budget with the aim of increasing spending on health care, education and the rehabilitation of basic infrastructure, including wage increases. Revenue projections, he said, are ambitious but achievable.

"For the coming years, strong international support remains needed to help alleviate poverty, including among returning refugees and internally displaced people. At the same time, the authorities' ability to mobilize external financing will depend on progress toward addressing Syria's legacy debts," said Van Rooden.

Despite the many constraints facing the Central Bank of Syria, van Rooden said it has managed to maintain a tight monetary policy. With no central bank financing of the budget, inflation has slowed markedly, falling to low single digits by the end of 2025, while the exchange rate has appreciated compared with 2024.

"With the introduction of the new currency well underway and building on the progress made, the focus will now need to be on empowering the central bank to ensure price and financial stability and ensuring its independence, developing an appropriate monetary policy framework, as well as on conducting a thorough assessment of banks' financial health and on the restructuring and rehabilitation of the banking system," he added.