Creating new perspectives since 2009

Lebanon declares a State of Economic Emergency

September 3, 2019 at 11:51 pm

Lebanon’s prime minister Saad Al-Hariri [Al Joumhouria/Twitter]

Lebanese Prime Minister Saad Al-Hariri said that Lebanon would declare a state of economic emergency and that his government has already started working on a plan to speed up public finance.

Al-Hariri added that the policy aimed to maintain the stability of the Lebanese pound, related to the US dollar, will continue.

The PM said ministers, politicians, and legislators who held a meeting today outlined a plan that would make public finance and economy more sustainable and agreed to declare a state of economic emergency.

He also told journalists after the meeting, which was attended by President Michel Aoun, “this economic situation is difficult. We, as a government, have to take swift action, such as the budget. We should be able to accomplish it on time to save time and reduce the budget deficit.”

He said the government would hold more meetings to speed up the work.

Lebanon is gripping under the most onerous public debt burdens the world had ever witnessed at 150 per cent of GDP. The country has also been suffering for years with low economic growth.

READ: Israel calls in UNIFIL, Lebanon to stop Hezbollah’s precision missiles

Government financial affairs, plagued with corruption and waste, are burdened by an inflating public sector, debt servicing costs, and subsidies for the state’s electricity producer.

Al-Hariri added that the proposed measures include sticking to this year’s budget. This means undertaking politically difficult steps such as freezing government appointments, dispensing units burdening the public treasury, and putting publicly owned companies for public subscription.

He said that the government aims to prevent the budget deficit from exceeding 5 per cent of GDP by the end of a three-year fiscal plan reaching an end in 2022.

Al-Hariri avoided answering a question about the possibility of raising taxes, saying that any of the steps the government would be considering to boost revenues would take into account the not increasing the burden.