UN chief: Lebanon’s economic crisis caused by ‘Ponzi scheme’

i24NEWS - Reuters

3 min read
UN Secretary-General Antonio Guterres attends a press conference at the end of his visit to crisis-struck Lebanon, in the capital Beirut, on December 21, 2021.
Anwar Amro/AFPUN Secretary-General Antonio Guterres attends a press conference at the end of his visit to crisis-struck Lebanon, in the capital Beirut, on December 21, 2021.

Guterres says that with corruption and 'other forms of stealing, the financial system has collapsed'

In a leaked video circulating on social media, United Nations Secretary-General Antonio Guterres explained that Lebanon’s economic crisis was created by “something similar to a Ponzi scheme.”

“As far as I understand, what has happened in Lebanon is that Lebanon was using something similar to a Ponzi scheme, which means… high interest rates to get more money, and paying the interest rates with the money that was coming,” the UN chief said during a private meeting in Lebanon on Tuesday.

“Which means that together with, of course, corruption and other, probably, forms of stealing, the financial system has collapsed.”

“This is a situation… for which we have many difficulties to deal with, as we have no authority of course to be going after the money,” Guterres continued.

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His comments were later confirmed by a financial professional who attended the meeting, Mike Azar.

When asked for a comment, a representative for the UN said that Guterres’ position was “more fully expressed” during a later news conference.

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Lebanon’s government is attempting to navigate the country out of its dire financial situation by appealing to the International Monetary Fund for financial assistance.

At the conference, Guterres urged Beirut to come up with a “credible economic recovery plan” for negotiations with the IMF.

The state’s economy collapsed after years of corruption and mismanagement, sinking Lebanon’s currency to 90 percent of its value.