France informed Lebanon today, Thursday, that there is no alternative to implementing a program under the supervision of the International Monetary Fund to get out of its current severe crisis, and that Beirut must implement urgent reforms in order to win international support.
"Help us to help you is the message on my visit," French Foreign Minister Jean-Yves Lauderian said after meeting with Lebanese leaders in Beirut, adding that Paris was ready to mobilize support, but that must be preceded by concrete action in terms of reform.
The financial crisis represents the greatest threat to Lebanon's stability since the civil war that took place from 1975 to 1990, and the country is in desperate need of such support, while suffering the scourge of a financial collapse rooted in corruption and government waste for decades.
The collapse of the lira has exacerbated inflation and poverty, and the Lebanese have been unable to withdraw their savings freely under a faltering banking system.
France is leading international efforts to push Lebanon to undertake reforms, and hosted a donors' meeting in 2018, during which they promised to provide more than $ 11 billion to invest in infrastructure, provided the reforms that were promised, but were not implemented.
Cash box
Last May, Lebanon began talks with the International Monetary Fund, but it stopped in the absence of reforms and with the emergence of differences between the government, the banking sector, and politicians over the size of the huge financial losses in the banking system.
Lebanon, burdened with one of the largest public debt burdens in the world, defaulted on its sovereign debts in foreign currencies last March, indicating very low foreign reserves. The Lebanese pound has lost about 80% of its value since October.
"Let's not pretend, there is no alternative solution to the fund to allow Lebanon out of the crisis," Ludriane said. "The need for reform is known to all."
Reforming the state-owned electricity network is one of the many areas that donors want to see progress on, as it drains up to two billion dollars annually in public funds, while the country's electricity needs are not met.
Ludryan said that the steps achieved so far in the electricity sector "are not encouraging".
"France will always stand by Lebanon, but for the endeavor to succeed the Lebanese authorities must perform their share of the work," he told a news conference in Beirut.
Ludryan indicated that it is necessary for Lebanon to respect the policy of distance from conflicts in the region.
Ludryan met with Lebanese President Michel Aoun and Prime Minister Hassan Diab, and government sources said Diab informed him that Lebanon had accomplished a number of reforms despite the obstacles, and set a time frame for implementing more reforms.
Government sources said that Diab also told Ludrian that the authorities had adopted an audit at the Central Bank of Lebanon to uncover the financial gap and its causes and pave the way for a possible audit in other institutions.