Following the formation of a new government, Lebanon has embarked on a renewed push to revive the negotiations with the International Monetary Fund. A core group of senior officials — including the finance and economy ministers, alongside the recently appointed central bank governor — has been entrusted to secure a formal agreement with the IMF. Yet, previous efforts faltered, notably due to the country’s failure to enact a long-delayed banking sector restructuring — a key condition of the 2022 staff-level agreement.

LIMS argued that a new window of opportunity has emerged. Lebanon has transitioned from deep fiscal deficits at the onset of the crisis to a fiscal surplus today, while the currency, once battered by hyperinflation, has stabilised. At the same time, the international community appears more receptive, buoyed by reform signals from the newly elected president and cabinet. Therefore, Lebanon should seize this momentum to negotiate a more feasible agreement with the Fund under revised terms.

Some policymakers have floated the revival of the McKinsey Plan — a pre-crisis economic blueprint — as a possible roadmap for reform. But LIMS has cautioned against this, criticising the plan’s central planning approach to the economy as ill-suited to Lebanon’s needs. Rather than orchestrating economic direction from the top, Lebanon should conduct structural reforms to dismantle entrenched monopolies, particularly in critical sectors such as electricity, internet, airlines and telecommunications.

Opening these sectors to competition would drive down costs, enhance service quality, and encourage innovation. In energy, liberalisation could provide reliable electricity for industry; in water, it could ensure better access for agriculture; in aviation, it could boost tourism; and in telecommunications, it could accelerate digital progress. With fewer barriers, private entrepreneurs will respond to these market signals in diverse ways—allocating resources to their most productive uses and forming partnerships organically, without the need for central direction. As if guided by an invisible hand, their individual decisions will collectively fuel economic growth. For Lebanon, choosing private-sector empowerment through liberalisation and competition rather than central planning offers the most credible and sustainable path to recovery.

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