Lebanon: Govt Approves Economic Reform Plan

Business

April 30th, 12:25pm

Asharq Al-Awsat

In this photo released by the Lebanese Government, President Michel Aoun, center, Prime Minister Hassan Diab, third left, and other government ministers wear masks to help protect themselves from the coronavirus, while attending the cabinet meeting at the presidential palace in Baabda, east of Beirut, Lebanon, Thursday, March 19, 2020. (Dalati Nohra/Lebanese Government via AP)

The Lebanese government has approved an economic reform plan to save the country from its grave crisis, an official source said on Thursday. The source added that the cabinet approved the plan after "minor amendments", noting that the question of the exchange rate was not decided on. The pound is still pegged at a rate of 1,507.5 to the dollar, even as it has slumped below 4,000 on a parallel market since October. The current situation is seen as the biggest threat to the country's stability since the 1975-90 civil war. The plan drawn up by Prime Minister Hassan Diab's government comes as mounting hardship fuels a new wave of unrest during which a protester was killed earlier this week. An early draft of the plan called it a "good basis" for any negotiations with the International Monetary Fund (IMF), widely seen as Lebanon's only way to secure desperately-needed financing. Another official source stressed that, now Lebanon has a plan, it must officially ask for IMF help, Reuters reported. The finalized document was not immediately available. The early draft of the plan set out vast losses in the financial system, including a projected $83 billion of losses in the banking system that has helped finance the state. The currency has shed more than half its value and savers have been shut out of their deposits since October, when countrywide protests erupted against ruling politicians. The early draft also called for an exceptional contribution from large depositors, leading to fierce criticism from opponents of the Diab government, notably former Prime Minister Saad al-Hariri and Progressive Socialist Party leader Walid Jumblatt.

from Asharq AL-awsat https://aawsat.com/english/home/article/2260896/lebanon-govt-approves-economic-reform-plan