Lebanon preparing public debt reform plan, assures on Eurobonds

Lebanon has been without a new government since May as politicians continue to wrangle over the make-up of a new national unity cabinet. (AFP)
Updated 10 January 2019

Lebanon preparing public debt reform plan, assures on Eurobonds

  • Lebanon has the third largest public debt-to-GDP ratio in the world at around 150 percent and has suffered from years of low economic growth
  • Fitch and Moodys both last month revised the outlook on Lebanon to negative from stable

BEIRUT: Lebanon is working on a public finance reform plan and studying ideas for managing the debt and its structure, the finance minister told Reuters on Thursday, after he was cited saying the plan included restructuring of public debt.
Ali Hassan Khalil's remarks to al-Akhbar newspaper about debt restructuring sparked a heavy sell-off in Lebanon's dollar-denominated debt. Some dropped more than 2 cents in the dollar to trade at their weakest in weeks.
In comments to Reuters, Khalil said Lebanon was committed to its Eurobond issuances and those that hold them, and would not violate any of their terms. He said "ideas for the management of the debt and its structure are still under study".
Lebanon has the third largest public debt-to-GDP ratio in the world at around 150 percent and has suffered from years of low economic growth. Its political leaders have been unable to form a new government since a May election.
Khalil told al-Akhbar the ministry was "preparing a financial correction plan including restructuring of public debt" saying this was needed to spare Lebanon "dramatic developments". The details had not been revealed to anyone, he added.
"The public debt cannot continue in this way," he said.
Asked by Reuters about the report, Khalil said the plan was "part of a reform project" for the public finances, starting with measures set out at a Paris donors' conference last year where Lebanon vowed to bring down its deficit.
"It is a voluntary financial correction plan being prepared in the ministry to avoid anything worse happening," he said. He said no steps had been taken yet and the aim was to have the plan ready for when a new government is formed.
The International Monetary Fund urged Lebanon in June to carry out "an immediate and substantial fiscal adjustment" to improve debt sustainability.
Fitch and Moodys both last month revised the outlook on Lebanon to negative from stable.
Lebanon's dollar-denominated debt tumbled in early trading.
Some issues - such as the 2020 and the 2025 bond dropped more than 2 cents in the dollar. The yields in the 2020 bond spiked to as much as 13.3 percent.


Family backs Tlaib’s decision not to visit Israel

Updated 18 August 2019

Family backs Tlaib’s decision not to visit Israel

  • Israel said a humanitarian travel request by Tlaib would be considered as long as she promised not to promote a boycott against Israel

RAMALLAH: Relatives of a US congresswoman say they support her decision to decline Israel’s offer allowing her to visit them in the West Bank because the “right to travel should be provided to all without any conditions.”

Rashida Tlaib said she would not see her family, even after Israel lifted a ban on her entry, because the government had imposed restrictions on her trip.

“We totally understand her position and support her in her efforts. The right to travel should be provided to all without any conditions,” her uncle Bassam Tlaib told Arab News.

He was speaking from the family home in Beit Ur Al-Fuka, which is 3 km from the West Bank city of Ramallah, and was flanked by his elderly mother.

He said his niece had visited them many times in the past, but there had never been any conditions attached to her travel.

“She said we will meet when she can come without conditions,” Tlaib said. “One idea has been floated of flying the grandmother to the US or finding a way to have the two meetings in a third country. You know my mother is nearing 90 and it is not easy for her to travel but we are checking out all options.”

Tlaib, a Democrat, has criticized Israel’s policy toward Palestinians and had planned to make an official visit to the country.

Israel said a humanitarian travel request by Tlaib would be considered as long as she promised not to promote a boycott against Israel, local media reported.

But the congresswoman, who is Palestinian-American, lashed out on social media.

“I can’t allow the State of Israel to take away that light by humiliating me & use my love for my sity to bow down to their oppressive & racist policies,” she tweeted, using the word sity to refer to her grandmother. “Silencing me & treating me like a criminal is not what she wants for me. It would kill a piece of me. I have decided that visiting my grandmother under these oppressive conditions stands against everything I believe in — fighting against racism, oppression & injustice.”

The NGO hosting and organizing the trip, Miftah, has been criticized by supporters of Prime Minister Benjamin Netanyahu’s government.

Hanan Ashrawi, the NGO’s founder, said her staff had organized other congressional trips. “This was the third trip we have organized, and we try to do our work professionally and seriously,” Ashrawi told Arab News. “Our very mission is to promote global dialogue and democracy.”

Ashrawi said the attacks on Miftah were unwarranted.  “Miftah has been targeted with the expressed goal of trying to discredit us even though our record is clear. We believe that they are trying to keep organizing congressional delegations within the AIPAC (American Israel Public Affairs Committee) monopoly, while we are trying to provide visitors with an opportunity to learn about Palestinian life under occupation and to understand the Palestinian narrative by providing opportunities for delegations to see and engage with Palestinians of all walks of life.” 

Ashrawi said Miftah had been “vetted” by the US Congress’ ethics committee. “We might not be able to bring hundreds of congress people like AIPAC, but we can bring a few and have them see, hear and interact with Palestinians.”

US President Donald Trump had called on Israel not to allow Tlaib and fellow congresswoman Ilhan Omar into Israel as admitting the two “would show great weakness.”

He tweeted that the pair “hate Israel and all Jewish people, and there is nothing that can be said or done to change their minds. Minnesota and Michigan will have a hard time putting them back in office. They are a disgrace.”