Abu Dhabi, UAETuesday 21 January 2020

Lebanon support group urges action at Paris meeting

Group met to discuss how best to support Lebanon through its political and economic crisis

The Egg, an abandoned cinema building in Martyr Square, downtown Beirut, Lebanon. EPA
The Egg, an abandoned cinema building in Martyr Square, downtown Beirut, Lebanon. EPA

Lebanon’s international backers urged immediate action from Beirut to form a new government and address major structural problems that risked a “chaotic unwinding of its economy".

The International Support Group for Lebanon was meeting in Paris.

It said a “substantial, credible and comprehensive policy package of economic reforms” were needed to halt financial and economic deterioration, restore confidence in the economy and address social and economic challenges.

The states and international organisations also said it was needed to provide answers to the aspirations expressed by the Lebanese since October 17, when mass protests against the government began.

Meanwhile, Lebanese Speaker Nabih Berri said the conference showed “a strong indication that the international community is more interested in Lebanon, its stability and security than some Lebanese".

Politicians are still divided on a path forward, despite demands from protesters for a non-political interim government of technocrats.

President Michel Aoun has delayed consultations to select a new prime minister several times as names forward are ruled out.

Saudi Arabia’s Foreign Ministry said on Tuesday that the stability of Lebanon was “very important to the kingdom".

"It is important for the Lebanese people and political system to find a way forward that guarantees stability and sovereignty,” the ministry said.

In another blow for Lebanon, caretaker finance minister Ali Khalil said that the 2019 deficit would be much bigger than expected because of a "very concerning" decrease in state revenues.

The government had sought to pass a budget with a small impact on the towering level of public debt, which is about 150 per cent of annual GDP – the third highest in the world after the US and Japan.

No new aid pledges were offered at the Paris meeting but caretaker Prime Minister Saad Hariri has been pushing to pass reforms to tap into $11 billion (Dh4.04bn) in grants and loans offered at a donor conference in 2018.

The aid will only be available after meaningful structural reforms are introduced, requiring Beirut to make cuts and pass new legal frameworks.

But the Parliament and Cabinet are yet to provide those reforms.

Attending the meeting were the UN special co-ordinator for Lebanon, and representatives of France, the UAE, US, UK, EU, Saudi Arabia, China, Egypt, Germany, Italy, Kuwait and Russia.

Also represented were the European Bank for Reconstruction and Development, the European Investment Bank, the International Monetary Fund, the Arab League and the World Bank.

Updated: December 12, 2019 01:43 AM

SHARE

SHARE