Middle East

Lebanon has not yet finalized plans to secure the IMF’s bailout agreement

Talks with the International Monetary Fund resumed in September this year, but Lebanese authorities have not yet submitted a comprehensive reconstruction plan.

The Lebanese pound has lost more than 90% of its value in two years, with four in five Lebanese living below the UN poverty threshold. (AP archive)

Lebanese authorities have not yet signed an international bailout agreement amid prolonged negotiations with the International Monetary Fund.

Lebanon’s GDP plummeted from about $ 55 billion in 2018 to $ 20.5 billion in 2021. This is a “brutal contraction” that the World Bank states “usually related to conflicts and wars.”

Lebanese officials met with the IMF delegation in early December to discuss “economic policies that are an integral part of the funding program that Lebanon can receive,” said Deputy Prime Minister Saade Chami, who heads the Lebanese IMF negotiations team. I told the AFP.

“We need to work with the IMF to prepare a comprehensive economic recovery plan that will be sent to the (IMF’s) funding committee for approval,” Cami said.

read more: Lebanon expects a draft agreement with the IMF within a few weeks

What’s on the table?

Lebanese officials have agreed that financial sector losses will reach about $ 69 billion, Cami said.

He said Lebanon could see “concrete results” as soon as January, but warned that the government “must show that it is committed to reform” before reaching an agreement. did.

Politicians have been unable to enact significant reforms to save the Mediterranean nation, and many have blamed the ruling class and central bank policies for crashing.

Lebanese Prime Minister Najib Mikati said Tuesday that the IMF team will visit the country on January 15.

The IMF delegation during the visit could see the government’s progress and close the deal back in early February, Mikati added.

read more: Lebanese Central Bank Needs $ 12-15 Billion to Revive Economy

Whether to audit?

Central bank audits are one of the greatest requirements of international donors and are widely seen as a prerequisite for IMF agreements.

The Alvarez & Marsal (A & M) company began auditing in September 2020, but was forced to withdraw two months later because the central bank was unable to deliver the required data.

In October of this year, Lebanese President Michel Aoun announced that the company would resume work and will submit a report to the government next month.

Former deputy governor-general of the central bank, Nacelle Saidy, suggested that the IMF would like to consider an audit, but Cami said no request had been made yet.

The potential IMF agreement will eventually attract other donors who may demand it as a prerequisite for assistance, such as the World Bank and the Gulf Arab countries.

read more: Lebanon needs “6-7 years” to recover from the crisis

Source: AFP

https://www.trtworld.com/business/lebanon-yet-to-finalise-plan-to-secure-imf-bailout-deal-53104?utm_source=other&utm_medium=rss Lebanon has not yet finalized plans to secure the IMF’s bailout agreement

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