LOC09:09
06:09 GMT
WASHINGTON, June 22 (KUNA) -- The economic situation in Lebanon "continues to be difficult" and spillovers from the conflict in Syria have affected growth and strained public infrastructure and services, according to an International Monetary Fund (IMF) assessment released late Thursday.
Following the Article IV Consultation with Lebanon last month, the IMF Executive Board noted in a statement "the economic situation in Lebanon continues to be difficult with high public debt, twin deficits, and tightening financial conditions. Spillovers from the conflict in Syria, including large numbers of refugees, have affected growth and strained public infrastructure and services."
Lebanon's economic growth remains low, estimated at about 1-1.5 percent in 2017 and 201, according to the IMF.
The country's traditional drivers of growth, real estate and construction, remains weak and a strong rebound is unlikely soon.
However, going forward, under current policies the IMF says growth is projected to gradually increase towards 3 percent over the medium term.
The directors stressed that an "immediate and substantial fiscal adjustment is essential to improve debt sustainability, which will require strong and sustained political commitment."
They noted that "a well defined fiscal strategy, including a combination of revenue and spending measures, amounting to about 5 percentage points of GDP is ambitious but necessary over medium term" to stabilize the Lebanon's public debt and place it on a declining path.
The IMF Directors also encouraged the authorities to redouble their efforts to improve governance and reduce corruption, and called for further improvements to the statistical system.
The next Article IV consultation with Lebanon will be held on the standard 12 month cycle. (end)
hy.gta