The International Monetary Fund expects that growth in Syria’s economy will accelerate to double-digit figures as early as 2026 and remain high in 2027. The IMF links this to the recovery of agriculture, increased oil and gas production, improved electricity supply, as well as the expansion of trade and services. At the same time, the fund warns that the recovery remains uneven across regions, inflation is accelerating this year, and the banking sector is still “highly imbalanced” and cannot fully finance the economy.
The assessments were released following a mission by an IMF team led by Ron van Rooden to Damascus from July 19 to 23. Fund representatives discussed economic developments and reform priorities; however, as stated in the announcement, the visit does not mean that a loan agreement or a new financing program has been reached.
Syria’s economic recovery began in 2025: after the change of regime, consumer and investor confidence rose, about 1.5 million refugees returned, and Syria is gradually restoring economic ties with neighboring countries and the rest of the world. This partially offset the effects of a severe drought that hit agriculture. In 2026, according to forecasts, the momentum will strengthen thanks to better rains and harvests, increased fuel extraction and electricity generation, as well as a rise in the number of visitors, government spending, and the return of refugees. The IMF’s new estimates are noticeably more optimistic than the April forecast of the World Bank, which expected Syria’s economic growth in 2025 to be only 2–4%. Support also came from the European Union lifting most sanctions and a U.S. license allowing investments, financial services, and transactions related to Syrian oil.
Despite the pickup in economic activity, inflation— which slowed in 2025 to low double-digit figures—has risen significantly since the start of 2026. The IMF explains this by higher import costs, above all for fuel and food, due to the regional conflict, as well as strong domestic demand boosted by higher wages for public-sector employees and by increases in utility and housing tariffs. Price hikes for electricity and services, as noted, are intended to cover operating costs and reduce the indirect financial burden on the state, but they also intensify pressure on household budgets. The fund expects inflation to slow in 2027, provided that import price pressures ease and the authorities adhere to disciplined fiscal and monetary policy. By way of comparison: the World Bank projected inflation to fall from 72.1% in 2024 to 11.5% in 2025, while noting that around 90% of households still struggle to meet basic needs.
Syria’s central government budget closed 2025 with a small surplus: the government kept spending within available resources, focusing on urgent needs, and stopped financing the budget through the central bank. In 2026, a significant increase in revenues is expected: first-half proceeds from taxes and customs rose noticeably, oil and gas revenues are expected to grow, and there are expected one-off receipts from telecommunications licenses and transit fees for fuel. At the same time, Syria’s Ministry of Finance reports that the 2026 budget provides for expenditures of around $10.5 billion, with expected revenues of 8.716 billion and a deficit of approximately $1.8 billion. The IMF advises preparing the 2027 budget based on conservative revenue estimates, restraining current spending, reducing off-budget operations, and improving the collection of taxes and customs duties.
The IMF gave a positive assessment of the issuance of a new national currency, but notes that monetary policy remains severely constrained due to the lack of effective tools and disruptions in the banking sector’s operations. The fund calls for the prompt preparation of a new central bank law and banking legislation that would give the central bank a clear mandate to ensure price stability, strong supervisory powers, and mechanisms to resolve problems at troubled banks.
Other priorities include a comprehensive assessment of banks’ financial stability in line with international standards, restoring payment systems, rebuilding depositor confidence, and expanding credit to businesses and citizens, including domestic and international transfers. In addition, Syria needs to strengthen its system for combating money laundering and terrorist financing so that it can exit the FATF “gray list,” where it remains under enhanced monitoring.
The IMF emphasizes that Syria needs strong and fast international financial support—not only for humanitarian needs, but also for restoring housing, infrastructure, public services, and creating jobs for returning and internally displaced people. At the same time, the government’s ability to attract external financing will depend on a comprehensive resolution of the country’s old debts and the development of a local capital markets. As AFP notes, the Syrian government has not yet sought help from the IMF, and any such request would likely be linked to a restructuring of the country’s external debt.
The IMF and Syrian authorities have agreed an expanded program of technical assistance. It covers budget management and government liquidity, tax and customs reforms, debt management, capital market development, restoring and overseeing banks, updating financial legislation, and improving statistics on GDP, prices, and the balance of payments. This, it is expected, will lay the groundwork for resuming Article IV consultations, which the Syrian authorities requested; the most recent completed consultations of this kind were held as far back as 2009.
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What happened in Syria during the mentioned “change of regime,” and when exactly did it take place? — In late November 2024, a coalition of armed groups led by Hay’at Tahrir ash-Sham launched a rapid offensive from the north of the country. By December 8, 2024, the forces of the previous government had lost control of Damascus, the Assad regime had effectively fallen, and Bashar al-Assad himself fled to Russia. Power then passed to a transitional government led by Muhammad al-Bashir.
What is known about the new Syrian national currency, and why did its issuance become an important step for monetary policy? — After the change of authority, the Central Bank of Syria announced that it would move toward issuing new banknotes without portraits and symbols of the overthrown regime. The main goal is to restore confidence in the Syrian pound, reduce dollarization in the economy, stop the depreciation of the national currency, and create a foundation for a more predictable monetary policy. Issuing the new currency is also seen as a signal to the international community that the transitional authorities are ready for financial reform.
Why is Syria on the FATF “gray list,” and what are the consequences for the banking sector and international settlements? — FATF placed Syria on the list of jurisdictions under increased monitoring due to systemic problems in combating money laundering and terrorist financing. Being on the “gray list” forces foreign banks to apply enhanced screening measures to Syrian counterparties, often rejecting or delaying payments and cutting correspondent banking relationships. This effectively blocks Syrian banks’ access to international markets and makes any cross-border transactions difficult.
What is the real scale of Syria’s external debt, and who are the main creditors? — The exact size of Syria’s external debt remains hard to verify because official statistics have not been published for many years. Estimates suggest that Syria’s total external debt may range from $20 billion to $40 billion, and according to some data, it is significantly higher. The main creditors are believed to be Russia, Iran, China, as well as some Arab countries and international financial institutions. A large portion of the debt was accumulated even before the conflict began, and after 2011 it grew further due to military loans and supplies made via routes circumventing sanctions.
What exactly does the U.S. license allow regarding Syrian oil, and which European sanctions did the EU lift? — The OFAC U.S. license regarding Syrian oil generally allows limited transactions involving energy commodities—for example, temporary purchase and transportation of crude oil or ensuring fuel supplies to Syria for humanitarian needs. The EU, in turn, announced a partial suspension of sanctions in sectors such as financial services, transport, and energy to support the transitional process. At the same time, the arms embargo and sanctions targeting individuals linked to the former regime remain largely in place. The exact parameters depend on the specific text of the license and the EU decision.
Full version: IMF expects Syria’s economy to grow by more than 10%