Lebanon’s new finance minister meets with IMF official
BEIRUT: The new finance minister of debt-saddled Lebanon met yesterday with an official from the International Monetary Fund for what he said was a “courtesy visit” and not bailout talks. Ghazi Wazni’s meeting with IMF alternative executive director Sami Geadah came as Lebanon grapples with its worst economic crisis since the 1975-1990 civil war.
The meeting served to “congratulate Lebanon on the formation of a new government,” Wazni said on Twitter afterwards. He had told AFP earlier that it was “a courtesy visit... to get to know the IMF team”. “The discussions will not focus on an economic rescue plan, which is being prepared (separately) inside government,” he added. It follows a meeting on Friday between Wazni and a delegation from the World Bank led by its regional director Saroj Kumar Jha. Wazni assumed the post of finance minister on Tuesday with the formation of a long-awaited cabinet that faces huge economic and political challenges.
The previous government resigned on October 29, two weeks into a nationwide protest movement demanding the removal of politicians deemed incompetent and corrupt. Wazni comes into the post at a time when the plummeting Lebanon pound has lost over a third of its value against the dollar in the parallel market.
Lebanese banks are tightening restrictions on dollar transactions amid a liquidity crunch.
The economic downturn has raised questions over whether Lebanon will turn to the IMF for a bailout — an option the government has yet to comment on but which some officials regard as inevitable. Last month, former prime minister Saad Hariri discussed a possible economic rescue plan with the heads of the IMF and the World Bank, further fuelling speculation of a bailout. If Lebanon does turn to the IMF it may have to increase its value-added tax, slash subsidies to the state-owned electricity company, tackle rampant corruption and enact a raft of structural reforms, according to previous IMF recommendations.