BEIRUT: Top-level talks on an economic rescue plan for Lebanon began Monday after the UN stepped in to help bring an end to military clashes along the country’s border with Israel.
An uneasy calm returned to both sides of the border following an exchange of fire between Hezbollah and Israeli military forces near the town of Maroun Al-Ras in southern Lebanon.
Clashes between Israel and Hezbollah intensified along the border after a week of rising tensions.
Israel’s military said it fired into southern Lebanon on Sunday after anti-tank missiles launched by Hezbollah targeted its army base and vehicles near the border. Hezbollah said that it was responding to an earlier drone attack by Israel.
The head of the UN peacekeeping mission, Maj. Gen. Stefano del Cole, said late on Sunday that he contacted both parties to call for an end to the fighting.
“This resulted in a restoration of general calm in the area of operations. Both parties assured me of their commitment to continue the cessation of hostilities in accordance with UN Resolution 1701,” he said.
Political leaders joined banking, finance and business chiefs at the top-level meeting on Lebanon’s economic future held at the presidential palace and chaired by President Michel Aoun.
“All of us are aware of the sensitivity of the economic and financial conditions we are experiencing. We are looking for effective solutions that will promote stability in order to avoid the worst,” the Lebanese leader said during the session.
“The circumstances require all of us to transcend our political or personal differences, and not to turn differences of opinion into conflict at the expense of the supreme interest of the nation. We must unite our efforts to come up with effective solutions to the economic crisis that is stifling the dreams and hopes of our people.”
Fixing the price of fuel, raising the tax on bank interest to 11 percent and increasing value-added tax are among reforms being considered.
Economist Louis Hobeika said that Lebanon’s 2019 budget had reduced the country’s fiscal deficit by 7.6 percent, but a greater reduction is required in 2020, “which means dealing with and fighting corruption.”
“I do not expect the meeting to make advanced decisions, because those attending are not serious about reducing spending or stopping mismanagement. I have warned against finding a way out by increasing taxes on citizens. People do not mind the increase, but only in exchange for serious reforms, not continuous corruption,” he said.
Hobeika said that the response of assembled officials to pleas regarding corruption did little to encourage optimism.
“It would have been better to have a unified paper by neutral economists adopted after discussion with politicians and even by public opinion. What is happening does not inspire confidence,”