IMF: Syria would need at least 20 years to regain pre-war economy

The Syrian economy contracted by at least 55 per cent in the first five years of the country's grinding civil war, and recovering just to the 2010 pre-war level could take at least a generation, the International Monetary Fund estimates.

A new report from the Washington-based crisis lender summarized the economic impacts of conflicts in the Middle East and North Africa, including the region's refugee crisis, which has spilled over into Europe.

In the report, IMF staff postulated an optimistic post-conflict growth rate of 4.5 per cent, roughly the average of a broad range of countries since 1970 that emerged from wars with at least 10 years of peace.

Even with that "relatively high" annual growth rate, as the report described it, Syria's economy would take at least 20 years to return to pre-war size.

"These are staggering numbers," IMF chief Christine Lagarde said in an IMF blog article published Friday. "Conflicts leave deep marks on economies."

Even buoyant growth after an end to the Syrian war could be fleeting, because many conflicts end not cleanly but with a period of lingering instability.

"Post-conflict countries typically remain for some time in a hybrid state where political and economic progress alternates with phases of temporary reversals and setbacks to the peace and rebuilding processes," the staff report said.

Post-conflict uncertainty and recurring violence can disrupt investment and economic development.

"These dynamics have harmed recoveries in several countries in the [Middle East and North Africa] region, including Afghanistan, Iraq, Libya, Somalia, and Sudan," the IMF report said.

"After initial successful recoveries, recurrent bouts of conflict forced policymakers, and economic agents more generally, to reassess the scope for rebuilding efforts and structural reforms."

Last update: Fri, 16/09/2016 - 17:09
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