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Lebanon PM appeals for foreign help to fight import crisis
BEIRUT, Dec 7, 2019 (BSS/AFP) – Lebanon’s outgoing Prime Minister Saad
Hariri asked foreign allies for help on Friday as the country’s dollar-
starved economy faces an import crisis after weeks of political and economic
turmoil.
Lebanon asked for credit lines from the United States, France, Russia,
Saudi Araba, Egypt, Turkey, China and Italy, a statement from Hariri’s office
said.
The appeal was part of an effort “to address a liquidity crisis and secure
basic imports” and was critical to preserving food security, the statement
said.
Since October 17, Lebanon has been rocked by anti-government protests that
triggered a protracted lockdown and prompted the cabinet to resign.
Political paralysis amid the ongoing demonstrations has aggravated a
dollar liquidity crisis that since September has seen banks limit dollar
withdrawals and transfers.
With banks failing to provide sufficient dollars, the greenback is selling
for more than 2,000 Lebanese pounds on the parallel market for the first time
since it was officially pegged at 1,507 in 1997.
Importers of fuel, medicines and wheat warn of shortages if the situation
persists.
Petrol station owners have already staged strikes, and hospitals have
threatened to stop admitting patients, fuelling public panic.
To ease the crisis, the central bank said in October it would facilitate
access to dollars at the official rate for importers of fuel, wheat and
medicine.
Other sectors have struggled to obtain hard currency for imports however,
with banks capping dollar withdrawals at $500 (450 euros) a week.
President Michel Aoun said on Friday the economy and finance would be
among the main priorities of the next government, which is yet to be
appointed.
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The formation of a new cabinet, the embattled president said, would
encourage donors to unlock an $11 billion (10 billion euro) aid package
pledged at a conference dubbed CEDRE held in Paris in April 2018.
Parliamentary consultations to select the cabinet are scheduled to start
on Monday.
Even before protests began, economic growth had stalled following repeated
political deadlocks in recent years.
The economic malaise was also compounded by the war in neighbouring Syria.
Public debt has reached more than $86 billion, over 150 percent of GDP,
according to the finance ministry.
The World Bank has warned of an impending recession that may see the
proportion of people living in poverty climb from a third to half the
population.
Unemployment, already above 30 per cent for young people, would also
increase, it has said.
In the span of a week over 60 companies notified the labour ministry of
plans to lay off employees, caretaker minister Camille Abousleiman told LBC
television on Friday.
The union of restaurant and bar owners has said that 265 establishments
have closed since the protests began in early October, and warned that this
figure could rise to 465 by the end of the year.
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