Lebanese government vows reform with help of $11bn international aid package

During the meeting with ISG members, President Michel Aoun said that Lebanon suffers from a significant economic contraction and faces high unemployment and poverty rates. (Supplied)
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Updated 07 April 2020

Lebanese government vows reform with help of $11bn international aid package

  • The virus crisis poses an unprecedented challenge for the Lebanese people, says PM

BEIRUT: The Lebanese government has called for international financial support to help it implement plans to tackle the country’s crippling economic crisis.

President Michel Aoun and Prime Minister Hassan Diab told a meeting of representatives of member states of the International Support Group (ISG) for Lebanon that their priority was to resolve the nation’s financial meltdown which had been compounded by the coronavirus disease (COVID-19) pandemic.
Asking for ISG help in line with its $11 billion CEDRE conference aid pledges — made on condition of internal reforms in Lebanon — was seen by major Lebanese parties, especially Hezbollah and the Amal Movement, as the preferred option to seeking assistance from the International Monetary Fund (IMF).
The impact of restrictions on movement imposed to stop the spread of COVID-19 has only served to deepen the economic turmoil in Lebanon, paralyzing business activity and adding to the hardships of its people. According to the World Bank, poverty rates in the country have increased to 40 percent.
During the meeting with the ISG delegates – which was attended by UN special coordinator for Lebanon, Jan Kubis – President Aoun said: “Lebanon was preparing to launch a workplan to address its economic, financial and social crises when the coronavirus pandemic struck the world.
“The country was forced to declare a health emergency, which froze its recovery and exacerbated its crises, adding to them a health crisis, and now we face all these crises and repercussions and we welcome any international assistance.

BACKGROUND

• The impact of restrictions on movement imposed to stop the spread of COVID-19 has only served to deepen the economic turmoil in Lebanon, paralyzing business activity and adding to the hardships of its people. According to the World Bank, poverty rates in the country have increased to 40 percent.

• Lebanese prime minister says his government has pledged to carry out a complete reform program to restructure the banking sector and the budget of the Central Bank.

“Lebanon suffers from a significant economic contraction, a decline in domestic demand and import, a severe shortage of foreign currencies, high unemployment and poverty rates, high prices and a low exchange rate of the Lebanese pound in the black market, in addition to the deficit in public finance due to a decline in tax revenues.
“The state decided to suspend payments for Eurobonds to contain the budget deficit and stop the depletion of its foreign currency reserves that have reached very low levels.”
He added: “The state is about to complete preparing a comprehensive economic-financial plan, with the aim of correcting the deep imbalances in the economy.
“Given the gravity of the financial situation and the significant economic effects on the Lebanese people, the residents, and the refugees, the reform program will need foreign financial support, and we rely heavily on $11 billion which CEDRE pledged to offer to Lebanon.”
Diab urged the ISG to launch “the economic, financial, monetary, and social reform plan based on good governance, and we are putting the final touches on it.”
The premier said his government pledged to carry out a complete reform program to restructure the banking sector and the budget of the Central Bank.
“We decided to conduct an audit of the Central Bank accounts for full transparency, and to strengthen our negotiating position in this difficult period in the history of Lebanon.”
Kubis said: “The COVID-19 crisis poses an unprecedented challenge for the Lebanese people due to the country’s economic problems, rampant corruption, and social pressures which cause despair.”


Lebanese MPs fail to reach agreement on draft amnesty law

Updated 29 May 2020

Lebanese MPs fail to reach agreement on draft amnesty law

  • The Free Patriotic Movement tried to amend the law by excluding “perpetrators of crimes against public funds and terrorist crimes” from the amnesty

BEIRUT: The Lebanese Parliament on Thursday failed to approve a draft law on general amnesty, after tensions rose during a vote and the Future Movement, led by former prime minister Saad Hariri, walked out of the legislative session.

“They want to bring us back to square one,” he said. “Every party has its own arguments, as if they want to score points.”

The Free Patriotic Movement tried to amend the law by excluding “perpetrators of crimes against public funds and terrorist crimes” from the amnesty. Minister of Justice Marie Claude Najm, who is affiliated with the FPM, asked for “amendments to the draft law so that it does not include those accused of tax evasion and violating maritime property.”

The draft law was referred to the parliament despite disagreements between parliamentary committees over the basic issue of who should and should not be included in the amnesty. The former government, led by Hariri, proposed a general amnesty law before it resigned last October in the face of mounting pressure resulting from public protests.

There were a number of protests during the legislative session, some opposing the adoption of the law entirely, while others were directed at specific provisions within it.

The draft law includes an amnesty for about 1,200 Sunni convicts, 700 of whom are Lebanese. Some are accused of killing soldiers in the Lebanese Army, possessing, transporting or using explosives, kidnap and participating in bombings.

It was also covers about 6,000 Lebanese Christians, most of whom fled to Israel following the withdrawal of occupying Israeli soldiers from southern Lebanon in 2000, as well as nearly 30,000 people from the Bekaa region, the majority of whom are from the Shiite community and wanted for drug trafficking, drug abuse, murder, kidnap, robbery and other crimes.

Hezbollah appeared to agree to a pardon for entering Israel, but object to a pardon for anyone who worked or communicated with the enemy or acquired Israeli citizenship.

Before the session, the Lebanese Order of Physicians highlighted overcrowding in Lebanese prisons, and this health risk this poses during COVID-19 pandemic.

“There are 20 prisons for men, four for women and one juvenile prison holding a total of 8,300 inmates, 57 percent of whom are in the Roumieh Central Prison,” the LOP said. It added that 57 percent of prisoners are Lebanese and 23 percent are Syrian, one third have been convicted while the rest are awaiting trial, and the overcrowding is so bad each prisoner has the equivalent of only one square meter of space. The organization described the situation as “a time bomb that must be avoided.”

In other business during the session, as part of anticorruption reforms required as a condition for receiving international economic aid, the Parliament approved a law to increase transparency in the banking sector, with responsibility for this resting with the Investigation Authority of the Lebanese Central Bank and the Anti-Corruption Commission.

It also endorsed a draft law to create a mechanism for top-level appointments in public administrations, centers and institutions. An amendment was added to prevent ministers from changing or adding candidates for the position of director general. The FPM opposed this, while Hezbollah and the Lebanese Forces voted in favor. Hariri accused the FPM of having a “desire to possess the entire country.”

MPs rejected a draft law to allow Lebanon to join the International Organization for Migration because, said MP Gebran Bassil, “it’s unconstitutional and facilitates the accession, integration and settlement process.” Lebanon hosts about 200,000 Palestinian and a million Syrian refugees.

The session sparked a wave of street protests. Some of them, led by the Syrian Social Nationalist Party and the Lebanese Communist Party, opposed the approval of a general amnesty that includes those who fled to Israel.

Protesters burned the Israeli flag in Sidon in protest against a law that “affects Israeli agents who sold their land, fought their people, and plotted against them.” They set up a symbolic gallows on which they wrote: “This is the fate of Zionist agents who fled execution.”

Others, including the families of Muslim detainees, staged demonstrations in support of the amnesty.