Lebanon given eight weeks to outline reforms

2 Sep 20

The French Government has warned that Lebanon has eight weeks to outline its governmental reforms if it is to receive disaster relief following the explosion that rocked the nation’s capital Beirut.

After Lebanese political leaders agreed to form a new government within two weeks, French president Emmanuel Macron stated he expected the government to start delivering on a roadmap of reforms “within six to eight weeks”.

“There is no blank cheque,” Macron told a news conference in the Lebanese capital.

If reforms, including an audit of the central bank, were not being passed within that deadline, international aid would be withheld, he added.

A recent report from the United Nations Population Fund said that more than 180 people had been killed by the blast, with the crisis expected to cost $344m. 

The UNFPA also revealed Lebanon’s central bank governor had warned that the bank may not be able to continue using its foreign currency reserves to finance trade and subsidise wheat, fuel and medicines.

It added that the lifting of subsidies would mean that commodities would be priced according to the market exchange rate, causing a significant spike on the current rate of LBP 1,500 to the US dollar.

Meanwhile, experts have warned the already impoverished population will struggle to pay for medicine, which is expected to rise to around five-times its current cost.

A large deficit and one of the world’s highest debt burdens led to Lebanon defaulting on its debts this year for the first time in its 100-year history.

A deal between Lebanon and the International Monetary Fund has stalled, with the Middle Eastern country so far refusing to sign up to the strict reform measures proposed by the fund.

Speaking after the explosion, IMF managing director Kristalina Georgieva said the international community needed to “step up to help [Lebanon] in this moment of urgent need”.

“The IMF is exploring all possible ways to support the people of Lebanon,” she said.

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