IMF warns Lebanon is at a 'very dangerous moment'
The continued 'policy of inaction is going to leave Lebanon in a never-ending crisis'
Crisis-hit Lebanon is “at a very dangerous moment,” an International Monetary Fund (IMF) delegation warned Thursday, criticizing slow progress on reforms needed to unblock billions of dollars in loans.
Lebanon and the IMF reached a conditional agreement in April last year on a $3 billion loan needed to save the country’s economy – in freefall since 2019.
The IMF conditioned the funds on a series of measures, notably unifying the country’s plethora of exchange rates, a reformed bank secrecy law as well as restructuring the banking sector, and the implementation of formal capital controls. But nearly a year after the deal was made, officials have yet to enact the substantial changes required to kickstart the 46-month financing program.
“We think Lebanon is at a very dangerous moment, at a crossroads,” said Ernesto Ramirez Rigo, who headed the visiting IMF delegation in Beirut, warning the continued “policy of inaction is going to leave Lebanon in a never-ending crisis.”
“The country is in a significant crisis. One would have expected a lot more in terms of implementation (of reforms),” Rigo added.
Lebanon’s economic meltdown – dubbed by the World Bank as one of the worst in recent global history – has pushed most of the population into poverty while the political elite, who are widely blamed for the country’s financial collapse, has failed to take action.
As reforms drag, the market value of the Lebanese pound reached historic lows against the U.S. dollar in March, prompting hundreds to take to the streets in protests over deteriorating living conditions on Wednesday.