- The IMF mission held productive discussions with the Lebanese authorities on a comprehensive economic reform program. Discussions are expected to continue, both from IMF headquarters and through follow-up missions.
- Bank restructuring remains a critical priority to restore the health of the banking sector, move away from the cash-based economy, restart credit to the private-sector, and protect depositors to the maximum extent possible.
- Given Lebanon's substantial reconstruction needs, limited fiscal space, and lack of capacity to borrow, the country will require significant support from external partners on highly concessional terms.
BEIRUT, Lebanon: At the authorities' request, an International Monetary Fund (IMF) mission led by Ernesto Ramirez Rigo visited Lebanon from May 28 to June 5, 2025, to initiate discussions on policies and a reform program that could be supported by an IMF arrangement.
At the conclusion of the mission, Mr. Ramirez Rigo issued the following statement:
"The IMF mission held productive discussions with the Lebanese authorities on a comprehensive economic reform program aimed at restoring macroeconomic sustainability and supporting financing for reconstruction. These initial discussions covered several reform areas, including (i) restoring the viability of the banking sector and protecting depositors to the maximum extent possible, (ii) achieving fiscal and debt sustainability, while enhancing social safety nets and rebuilding institutional capacity, (iii) establishing credible monetary and exchange rate policy frameworks, (iv) strengthening governance and transparency, (v) enhancing the Anti-Money Laundering and Combating the Financing of Terrorism (AML/CFT) regime, and (vi) reforming state-owned enterprises.
It was agreed that the rehabilitation of the banking system remains a critical priority to rebuild confidence in banks, move away from the current cash-based economy, and restart credit to the private-sector, which is necessary for growth. The authorities have made some progress recently, including the amendment of the Bank Secrecy Law and submission of a new bank resolution law to Parliament. The next step is for Parliament to approve this legislation, which will establish powers to underpin the recovery of orderly banking intermediation, while safeguarding the public interest. The mission also engaged with the authorities on their emerging bank restructuring and deposit recovery strategy. More work in close cooperation with the authorities will be needed to ensure this strategy is aligned with international standards and debt sustainability requirements.
"The mission also discussed the 2026 Budget and the development of a medium-term fiscal framework. For the 2026 Budget, given the limited fiscal space and available financing, it is critical that any additional expenditures be fully offset by corresponding revenue efforts, including by strengthening enforcement and compliance in tax and customs administration. An ambitious medium-term revenue mobilization and expenditure rationalization strategy along with improved fiscal transparency and public financial management is needed to strengthen public finances and create space for increased social protection and capital expenditures. The medium-term fiscal framework should also support the restructuring of Eurobonds to restore debt sustainability. Given Lebanon's substantial reconstruction needs, the authorities' reform efforts will require significant support from external partners, preferably on highly concessional terms. Enhanced support to Lebanon is also needed to help the country shoulder the continued burden of hosting a large refugee population.
"Building on these key reform pillars, discussions on formulating a comprehensive reform program are expected to continue, both from IMF headquarters and through follow-up missions. The mission reaffirmed the Fund's commitment to supporting Lebanon during this challenging period, consistent with its mandate and policies.
"The mission thanks the Lebanese authorities and all stakeholders for their cooperation and constructive engagement."
