Lebanon Must Ensure Debt Sustainability to Borrow, IMF Says By Bloomberg

Lebanon Must Ensure Debt Sustainability to Borrow, IMF Says By

© Bloomberg. A protester stands alongside an excavator on fire during a demonstration close to parliament in Beirut, Lebanon, on Saturday, Aug. 8, 2020. Lebanese protesters took to the streets of Beirut on Saturday amid growing anger at the government following the devastating blast that killed dozens this week.

(Bloomberg) — Lebanon needs to ensure debt sustainability and a solvent financial system to be able to borrow, according to the International Monetary Fund.

“Those who benefited from past excessive returns need to share the burden of bank recapitalization, to protect the life savings of the vast majority of ordinary Lebanese depositors,” IMF Managing Director Kristalina Georgieva said in a statement on Sunday.

The IMF is seeking reforms as it negotiates billions of dollars of loans for the country. The Middle Eastern nation must also adopt safeguards to avoid further capital outflows, including putting in place legislation to formalize capital controls in the banking system.

The international lender also urged Lebanon to eliminate its multiple exchange rate system to stop further deterioration in its currency, and to curb corruption, Georgieva said.

Outrage over the deadly Aug. 4 explosion at the Port of Beirut is running high in Lebanon and beyond, with protesters demanding regime change and for the government of Prime Minister Hassan Diab to resign. The blast killed more than 150 people, injured 6,000 and destroyed large parts of the capital. It also came at a time when Lebanon is reeling from its worst financial meltdown and political crisis in decades.

U.S President Donald Trump, who joined other countries in offering support and aid to Lebanon, said he acknowledged the “legitimate calls” of protesters for transparency, reform, and accountability.

Other highlights from the IMF statement:

  • The fund engaged “intensely” with Lebanese authorities on a reform package aimed at addressing the deepening crisis, but the discussions “have yet to yield results.”
  • Lebanon needs to implement an expanded social safety net to protect the most vulnerable people, as well as reduce the protracted losses in many state-owned enterprises.
  • IMF wants more transparency and accountability, such as comprehensive audits of key institutions, including the central bank.

©2020 Bloomberg L.P.

Disclaimer: Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore Fusion Media doesn`t bear any responsibility for any trading losses you might incur as a result of using this data.

Fusion Media or anyone involved with Fusion Media will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.

Source link


Leave a Reply

Your email address will not be published. Required fields are marked *

About us

InvestLab is a financial services technology company focused on the global trading market. Founded in 2010 in Hong Kong, the company develops trading, market data, and social research products that enable individual investors and small to mid-size brokers to access global markets. We provide brokers and financial institutions cross border capabilities for retail investors into 43 markets globally.