Hezbollah says it opposes IMF management of Lebanon crisis

(Reuters)
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Updated 25 February 2020

Hezbollah says it opposes IMF management of Lebanon crisis

  • Iran-backed group's opposition to IMF makes managing Lebanon's situation "very, very difficult"
  • Lebanon's financial crisis continues to deepen, exacerbated by civil protests

BEIRUT/LONDON: Hezbollah is against allowing the International Monetary Fund to manage Lebanon’s financial crisis, the powerful group said on Tuesday, indicating opposition to any IMF bailout that would impose tough conditions on the heavily indebted state.
Hezbollah, backed by Iran and designated as a terrorist group by the United States, is one of the main parties that backs the new Beirut government as it struggles with the unprecedented crisis.
Facing a huge public debt burden and a liquidity crunch, the government on Tuesday appointed international investment firm Lazard and law firm Cleary Gottlieb Steen & Hamilton LLP as its financial and legal advisers on a widely expected sovereign debt restructuring.
Beirut has sought IMF technical but not financial aid.
“We will not accept submitting to (imperialist) tools ... meaning we do not accept submitting to the International Monetary Fund to manage the crisis,” said Hezbollah’s Sheikh Naim Qassem, deputy leader of the heavily armed Shiite group.
“Yes, there is nothing to prevent consultations ... and this is what the Lebanese government is doing.”
An IMF technical team visited Beirut from Feb. 20-24. “The discussions on the challenges and the authorities’ plans to address them were very informative and productive,” IMF spokesman Gerry Rice said.
“Staff is available to provide further technical advice to the government as it formulates its economic reform plans.”
The crisis came to a head last year as capital inflows slowed and protests erupted against the ruling elite over corruption and bad governance — root causes of the crisis.
Banks are imposing tight restrictions on access to deposits and transfers. The Lebanese pound has slumped: dollars were being offered at 2,470 pounds on Tuesday, a dealer said. The official rate is 1,507.5.
“Hezbollah is very adamantly opposed to the IMF and that makes it very, very difficult and means Lebanon will have to get to a point where the situation is bad for longer,” said Steffen Reichold, portfolio manager at ‎Stone Harbor Investment Partners, which holds some Lebanese Eurobonds.
“That could mean the exchange rate getting to 3,000 and significantly more inflation.”
French Finance Minister Bruno Le Maire said on Monday his government was looking at options to help Lebanon recover, including an IMF program if Beirut seeks one.
Foreign states which have backed Lebanon in the past want to see implementation of long-delayed reforms before any assistance is forthcoming this time.
Some of Lebanon’s Eurobonds intensified their sell-off.
The government must urgently decide how to handle a $1.2 billion Eurobond maturing on March 9.
“It’s pretty likely they will go down the debt restructuring route and the question then becomes will the March 2020 bonds be brought in to that,” said Nick Eisinger, principal, fixed income emerging markets, at Vanguard.
“I think the market will not be particularly happy that the IMF will not be coming on board with a financial program as without that the recovery prospects and long-term recovery of the country are not good,” he said. 


Protesters pack Tel Aviv rally against coronavirus cash crisis

Updated 12 July 2020

Protesters pack Tel Aviv rally against coronavirus cash crisis

  • Event was organized by self-employed, small business and performing artists’ groups angry at coronavirus curbs which have taken away their livelihoods

TEL AVIV: Thousands of Israelis streamed into Tel Aviv’s Rabin Square to protest Saturday against the government’s handling of economic hardship caused by coronavirus curbs.
About 300 officers were deployed in the square, a traditional protest site, to ensure public order and monitor social distancing regulations, police said.
Many participants wore facemasks but most appeared to be less than the statutory two meters (yards) apart.
Some held banners reading in Hebrew: “Let us breathe” — an echo of worldwide protests sparked by the death of George Floyd, an unarmed black man, during a US police arrest.
The event was organized by self-employed, small business and performing artists’ groups angry at coronavirus curbs which have taken away their livelihoods.
Student unions also took part over the large numbers of young people made jobless by closures.
Israel imposed a broad lockdown from the middle of March, allowing only staff deemed essential to go to work and banning public assembly.
Places of entertainment were closed, hitting the leisure industry hard.
Facing public and economic pressure, the government eased restrictions in late May.
But infections have mounted and rules tightened again, including the closure of event venues, clubs, bars, gyms and public pools.
While salaried workers sent on furlough received unemployment benefits, the self-employed said most had been waiting months for promised government aid.
“There is a very grave crisis of confidence between us and the government,” Shai Berman, one of the protest organizers told Israeli public radio ahead of the rally.
“We are part of a very large public which is feeling growing distress and wants to demonstrate and simply does not believe the promises,” he added.
Berman was among activists invited Friday to meet Prime Minister Benjamin Netanyahu and finance ministry officials in a last-minute government effort to stave off the protest.
“He tried, very politely,” Berman said, adding that an aid package presented at the meeting was a start, but flawed.
Netanyahu promised swift implementation.
“We will meet our commitments including hastening the immediate payments that we want to give you,” his office quoted him as telling the activists.
On Friday, the health ministry announced the highest number of coronavirus infections over a 24-hour period, with nearly 1,500 new cases confirmed.
The country of roughly nine million has now registered more than 37,000 cases, including over 350 deaths.