Lebanon appeals for international financial aid amid Covid-19 crisis

Diab said the government was putting the ‘final touches’ to the reform plan, which he said would be ‘ready soon’.
Monday 06/04/2020
 Lebanese Prime Minister Hassan Diab speaks to the media outside Beirut’s International Airport, Lebanon April 5. (Reuters)
Needing help. Lebanese Prime Minister Hassan Diab speaks to the media outside Beirut’s International Airport, Lebanon April 5. (Reuters)

BEIRUT--Faced with a severe economic downturn compounded by the coronavirus, Lebanon is appealing to donor countries and international financial organisations to provide badly-needed assistance.

Days after the World Bank re-allocated $40 million to help Lebanon fight the Covid-19 pandemic, Lebanese President Michel Aoun urged donors to unlock $11 billion in grants and loans they pledged during a Paris conference in April 2018.

The call comes as his government prepares to launch a long-awaited reform plan demanded by international partners.

“Given the danger of our current financial situation and its significant economic impact on nationals, residents and refugees, our reform programme will need external financial support,” Aoun told ambassadors from donor countries in the International Support Group (ISG) for Lebanon.

“Lebanon was preparing to launch a workshop to deal with its economic, financial and social crises when the coronavirus pandemic struck the world and therefore had to declare a state of health emergency which exacerbated its crises,” Aoun said, appealing for help.

“Today we are confronting all these crises and their consequences and we welcome any kind of international assistance,” he said.

Prime Minister Hassan Diab’s cabinet, nominated in January to tackle a financial meltdown and unprecedented anti-government protests, has pledged a far-reaching reform plan to address the crisis as it seeks to enter restructuring negotiations with creditors.

Diab said the government was putting the “final touches” to the reform plan, which he said would be “ready soon.”

Lebanon is in the throes of its worst economic crisis since the 1975-1990 civil war.

The Lebanese pound has lost more than a third of its value on the black market, consumer prices have skyrocketed and unemployment is on the rise at a time when the entire country is on lockdown due to virus fears.

Making matters worse, foreign currency reserves have plummeted amid a grinding liquidity crunch, forcing the cash-strapped government in March to default on its sovereign debt for the first time.

Aoun said international partners had a responsibility to help Lebanon shoulder the burden of hosting tens of thousands of Palestinians and at least 1.5 million Syrians, warning of a health catastrophe if the virus hits refugee camps.

So far, there are 541 infections and 19 deaths across Lebanon.