The economic fallout from the prolonged pandemic has required extensive policy responses, leaving a large dent in policy space. A key challenge to fiscal authorities in a post-pandemic environment is how to adjust fiscal policy to maintain a good balance between rebuilding fiscal buffers and maintaining policy support.

This paper argues that post-pandemic fiscal adjustments can be presented in three overlapping phases: fiscal normalization, fiscal consolidation, and fiscal structural reform. Fiscal normalization should start by reducing some emergency measures based on a need assessment. Meanwhile, a clear fiscal consolidation plan should be prepared with specific fiscal targets and measures. Lastly, both fiscal normalization and consolidation must consider structural reform priorities.