IMF condemns Lebanon ‘very slow progress’ on reforms

BEIRUT: The International Monetary Fund on Wednesday condemned Lebanon’s “very slow” progress on implementing reforms needed to unlock a $3-billion-dollar loan crucial to revive its battered economy.

Lebanon and the IMF reached a conditional agreement on the loan in April to help the country stem its worst-ever economic crisis, which the World Bank has branded one of the planet’s worst in modern times.

But Lebanon has yet to enact the reforms needed to unlock the funds.

“Despite the urgency for action to address Lebanon’s deep economic and social crisis, progress in implementing the reforms… remains very slow,” said Ramirez Rigo, who headed an IMF delegation that visited Beirut this week and met with top officials.

“The majority of prior actions have not been implemented,” he said in a written statement, adding that delays in implementation will “only increase the costs to the country and its population”.

The IMF conditioned the funds on a series of measures, notably parliament approving a 2022 budget and a reformed bank secrecy law as well as restructuring the banking sector and the implementation of formal capital controls.

“Completion of these and other prior actions is also needed for the IMF board to consider the request for a financial program with Lebanon,” Rigo said.

Lebanon’s economy minister Amin Salam, who met with the delegation, said the IMF was pushing Lebanon to enact reforms before the country heads for presidential elections in the coming weeks.

“Before we enter the period of presidential elections, we must try to enact those four” measures, he told AFP.

The mandate of President Michel Aoun ends on October 31 but there is no consensus on naming his successor, as Lebanon’s economy continues to crash.

In a possible protracted political deadlock, politicians have yet to agree on a new government since the mandate of the outgoing cabinet expired in May.

Ministers are currently operating in a caretaker capacity until a new team is formed.

Parliament has also been gripped by political paralysis, with a session to approve the 2022 budget adjourned last week to September 26 due to lack of a quorum.

An IMF delegation is due to return to Beirut in October to follow up on progress, Salam said.