IMF Staff Concludes Visit to Lebanon

IMF News, September 26, 2025

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IMF team led by Ernesto Ramirez Rigo visited Beirut, Lebanon, from September 22 to 25.
End-of-mission press release dated September 26, 2025.
Statement notes: This mission will not result in a Board discussion.
Engagement is expected to continue, including during the October 2025 IMF Annual Meetings.

Lebanon’s economy shows resilience despite the significant impact of the regional conflict.
The economy is recently experiencing a partial economic rebound on the back of strong diaspora tourism.
Authorities have maintained a tight fiscal and monetary stance, accumulating some additional international reserves and keeping a small fiscal surplus.
Authorities have moved ahead with the establishment of regulatory authorities in the electricity and telecommunications sectors.
Fiscal statistical capacities are being rebuilt and digital processes for tax compliance are being strengthened.
Restoring strong and sustainable growth requires implementing ambitious and comprehensive reforms to tackle long-standing structural weaknesses and to attract international support for economic rebuilding and reconstruction of war-devastated areas.

Authorities have made progress in developing a strategy to address severe banking sector challenges.
The recent approval of the Bank Resolution Law reflects dedicated efforts by stakeholders, though the legislation needs further refinement.
The IMF team has suggested amendments to fully align the law with international standards and ensure effective bank restructuring processes.
Authorities should continue developing the strategy to recognize and allocate losses, and restore banking sector viability consistent with international standards, protection of small depositors, and sustainability of public debt.

The IMF team expected a more ambitious approach to the 2026 government budget than the draft approved by the Cabinet.
On revenues:
- Government measures to broaden the tax base and improve compliance are rightly envisaged.
- Tax policy reforms should also be considered to create fiscal space for priority spending on reconstruction and social protection.
- The retraction of excise taxes on fuel poses serious concerns regarding the ability of the government to finance its spending.
On expenditures:
- All expected items should be transparently recorded, including those externally financed.
- Spending decisions need to be consistent with available financing.
The mission called for stepping up efforts toward adoption of an ambitious medium-term fiscal framework, necessary for developing a credible strategy to restore fiscal and debt sustainability.

The mission looks forward to continuing discussions with the authorities on these issues, including during the upcoming IMF Annual Meetings.
The IMF reiterates its commitment to supporting Lebanon in developing and implementing a comprehensive economic reform program consistent with its policies and mandate.
The IMF team thanked the Lebanese authorities for productive discussions and their hospitality.

IMF Staff Concludes Visit to Lebanon, September 26, 2025.