(MENAFN- Kuwait News Agency (KUNA)) WASHINGTON, Nov 17 (KUNA) -- The International Monetary Fund (IMF) said Monday that Syria's economy is showing signs of recovery and improving prospects, reflecting the improvement in consumer and investor sentiment.
This is due to Syrian authorities' ability to adopt a tight fiscal and monetary stance within the many constraints they face, with a view to ensuring economic and financial stability, the IMF said in a press release.
Against this backdrop, fiscal discussions focused on the formulation of the 2026 government budget, which aims to increase fiscal space for meeting essential needs, including for social sectors to support the most vulnerable, while ensuring that it is based on ambitious but realistic revenue and financing assumptions.
IMF staff will provide extensive technical assistance to strengthen the fiscal framework by helping to: (i) improve public financial management and revenue administration; (ii) finalize new tax legislation; and (iii) develop a strategy to address Syriaآ's legacy debts and strengthen debt management.
In this context, it is important that the new tax regime will be simple, competitive, and easy to administer, while avoiding generous exemptions and creating room for arbitration and avoidance, it said.
Similarly, as the authorities restructure state-owned enterprises and pursue large investment projects with the private sector, it is important to adhere to good governance standards and ensure that the Ministry of Finance plays a key role in assessing and controlling potential contingent liabilities.
Staff also initiated discussions on developing an appropriate monetary policy framework that would support ensuring low and stable inflation, while considering the current challenges in the financial system, it added.
In this regard, IMF staff will provide technical assistance to support the authorities with: (i) the formulation of new financial sector legislation and regulation; (ii) the rehabilitation of the payment and banking systems, to ensure that the financial system can facilitate safe and efficient payments, banks can resume their crucial role in financial intermediation and support the economic recovery; and (iii) rebuilding capacity at the central bank to ensure it can effectively implement monetary policy and supervise the financial system.
The IMF mission reaffirmed the commitment to support the authorities in their efforts to rehabilitate Syriaآ's economy and key economic institutions. (end)
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