Syria recorded a slight budget surplus in 2025, marking a notable fiscal turnaround after years of strain, according to a new report by the International Monetary Fund.
The Fund also expressed cautious optimism about the country’s economic trajectory in 2026, citing accelerating activity and improving macroeconomic indicators.
The findings follow an IMF staff visit to Damascus between February 15 and 19, 2026, aimed at assessing recent developments and outlining priorities for economic stabilization and institutional reform.
The IMF report highlights a pickup in economic activity in recent months, driven by several converging factors: improved consumer and investor confidence, the continued return of refugees, easing of international sanctions, expanded electricity supply, favorable rainfall, and Syria’s gradual reintegration into its regional environment.
New investment projects have also supported growth prospects for 2026 and beyond, strengthening expectations that the economy may be entering a more sustained recovery phase.
The Fund’s current engagement focuses on technical assistance and advisory support to rehabilitate key economic institutions, including the Ministry of Finance and the Central Bank of Syria, alongside improvements in data collection and statistics. These steps are intended to pave the way for the eventual resumption of Article IV consultations.
Preliminary data cited in the report indicate that the 2025 state budget achieved a modest surplus. Authorities prioritized essential spending, wage adjustments, and living standards improvements, notably without resorting to central bank financing.
This development marks a significant shift from previous years, when fiscal deficits were often monetized, fueling inflationary pressures.
For 2026, the government has drafted a budget that increases allocations for health care, education, and infrastructure rehabilitation. Revenue projections are described as ambitious but achievable, with built-in safeguards to address potential shortfalls.
Authorities have emphasized the need to protect social spending and strengthen safety nets for vulnerable populations. Enhancing public expenditure efficiency, transparency, and the digitalization of government services also feature prominently in reform plans.
The IMF underscored the importance of improving governance and operational performance in state-owned enterprises, while addressing accumulated public debt.
Securing external financing, the report noted, will depend on progress in resolving legacy debt obligations and strengthening fiscal credibility.
The Central Bank of Syria has maintained a tight monetary stance, contributing to a slowdown in inflation to low double-digit levels by the end of 2025. The Syrian pound has also shown relative appreciation compared with 2024.
With the introduction of a new currency, the IMF recommended reinforcing central bank independence, developing a more robust monetary policy framework, and conducting a comprehensive assessment and restructuring of the banking sector to restore confidence and enhance financial intermediation.
The IMF confirmed it will continue supporting Syria through an extensive technical assistance program covering public financial management, debt management, revenue mobilization, financial sector legislation, banking system rehabilitation, and statistical improvements.
Follow the latest news on Google News
