ZCZC
BCN-08
LEBANON-POLITICS-ECONOMY
Crisis-hit Lebanon to approve economic rescue plan
BEIRUT, April 30, 2020 (BSS/AFP) – The Lebanese government met Thursday to
approve a long-awaited plan to rescue the debt-saddled economy from its worst
crisis in decades, following a fresh wave of angry streets protests.
A lockdown to fight the coronavirus pandemic has added to the economic woes
besetting the country, which include soaring inflation, a liquidity crunch and
a plummeting currency.
In March the cash-strapped government defaulted on its sovereign debt for
the first time.
The cabinet began meeting at the presidential palace in Baabda, following a
third straight night of violence in northern Lebanon.
The army clashed again with protesters angered by soaring inflation and an
unprecedented devaluation of the Lebanese pound.
On Monday a man was killed after being struck by a bullet fired by a
soldier in clashes in the northern city of Tripoli.
In the southern port city of Sidon, demonstrators threw Molotov cocktails
at bank branches and offices of the central bank overnight.
Leaks on the economic plan to Lebanese media suggest the country needs $80
billion in funds to exit the crisis, including $10 to $15 billion in external
financing in the next five years.
Planned reforms reportedly include cuts to state spending and a
restructuring of the public debt, one of the highest in the world at 170
percent of gross domestic product (GDP).
Lebanon is grappling with its worst economic turmoil since the 1975-1990
civil war, compounded by measures to tackle a novel coronavirus outbreak that
has infected more than 700 people and killed 24.
The Mediterranean nation has been rocked by a series of political crises in
recent years.
An economic crunch helped set off unprecedented cross-sectarian mass
protests in October and unseated the last government.
The demonstrations had largely petered out after a new cabinet was tasked
earlier this year with implementing urgent reforms to unlock billions in
international aid.
But protesters have hit the streets again in recent days in defiance of the
lockdown, railing against a sharp devaluation of the pound and rocketing
inflation.
Prices have risen by 55 percent, while 45 percent of the population now
lives below the poverty line, according to official estimates.
The government has yet to request financial assistance from the
International Monetary Fund, which has so far only provided technical
assistance.
Experts have lobbied in favour of an IMF bail out which they say is the
country’s only escape route from its current slump, but some officials remain
wary of the world body.
BSS/AFP/MMA/1545HRS