Lebanon’s Hariri calls for cabinet solidarity in budget debate

Saad Al-Hariri said the cabinet held 19 sessions to conduct discussions on the budget. (File/AFP)
Updated 18 June 2019

Lebanon’s Hariri calls for cabinet solidarity in budget debate

  • The PM said cabinet ministers need to be united and responsible
  • Lebanon’s debt is almost 150% of its GDP

BEIRUT, June 18 : Lebanon Prime Minister Saad Al-Hariri on Tuesday called for parliament to quickly approve the country’s 2019 budget and urged his coalition government to avoid internal disputes.
The cabinet this month agreed a budget plan that shrinks the projected fiscal deficit by 4 percentage points from last year to 7.6% by cutting spending and raising taxes and other fees.
“What I want during the debate is for us to be responsible and united, and not contradictory,” Hariri said in a statement, addressing cabinet ministers as to their comportment during the parliament debate.
Parliament’s finance committee is debating the draft budget and has suggested amendments, local newspapers reported. It will then put the budget to the full assembly to ratify it.
Parliament is mostly composed of parties that are also present in the coalition government and which supported the budget there.
Since the budget was agreed there have been fierce arguments between parties in the coalition over several subjects, though these have not targeted the budget.
Lebanon has one of the world’s heaviest debt burdens, equivalent to about 150% of GDP, and the International Monetary Fund has urged it to cut spending.
“We have held 19 cabinet meetings to agree on this draft budget and these sessions were not for fun, but for deep, detailed debate over every clause and every idea,” Hariri said.
“For this reason, I consider it the responsibility of each of us in government to have ministerial solidarity...to defend in parliament the decision that we have taken together,” he added.
After the 2019 budget is agreed, the cabinet must quickly start working on the 2020 budget and on approving the first phase of a program of investments toward which foreign donors have offered $11 billion in project financing. (Reporting by Angus McDowall, editing by Ed Osmond)


Lebanon central bank reassures foreign investors about deposits

Updated 2 min 47 sec ago

Lebanon central bank reassures foreign investors about deposits

BEIRUT: Lebanon’s central bank said on Saturday there would be no “haircut” on deposits at banks due to the country’s financial crisis, responding to concerns voiced by a prominent Arab billionaire about risks to foreign investments there.
Emirati businessman Khalaf Ahmad Al-Habtoor, founder of the Al Habtoor Group that has two hotels in Beirut, posted a video of himself on his official Twitter account asking Lebanon’s central bank governor if there was any risk to dollar deposits of foreign investors and whether there could be any such haircut.
“The declared policy of the Central Bank of Lebanon is not to bankrupt any bank thus preserving the depositors. Also the law in Lebanon doesn’t allow haircut,” the Banque Du Liban (BDL) said in a Twitter post addressed to Habtoor, from Governor Riad Salameh.
“BDL is providing the liquidity needed by banks in both Lebanese pound and dollars, but under one condition that the dollars lent by BDL won’t be transferred abroad.”
“All funds received by Lebanese banks from abroad after November 17th are free to be transferred out,” it added on its official Twitter account.
The heavily indebted country’s crisis has shaken confidence in banks and raised concerns over its ability to repay one of the world’s highest levels of public debt.
Seeking to prevent capital flight as hard currency inflows slowed and anti-government protests erupted, banks have been imposing informal controls on access to cash and transfers abroad since last October.
A new government was formed this week, and its main task is to tackle the dire financial crisis that has seen the Lebanese pound weaken against the dollar.
Habtoor had asked Salameh for clarity for Arab investors concerned about the crisis and those thinking of transferring funds to Lebanon to try to “help the brotherly Lebanese.”