In a dispatch published by AFP, the controversial governor of the Banque du Liban Riad Salamé estimated that 12 to 15 billion dollars in international aid in the form of loans would be necessary to initiate the economic recovery , while the Land of the Cedars is going through a financial crisis described as one of the 3 worst crises taken since the mid-19th century by the World Bank.
He thus estimates that if Lebanon could obtain 4 billion dollars of quota of the International Monetary Fund, this sum could be supplemented by other countries. He also revealed that currency reserves have fallen to $ 12.5 billion, below the required currency reserves which were estimated at $ 14 billion until recently.
While $ 12 billion to $ 15 billion is needed to kick-start the economic recovery when the economic recession reached 25% in 2020 and could reach 11% in 2021, questions still revolve around the amount needed to fully overcome the economic crisis, some note. sources.
This information comes at a time when Lebanon, if it has provided an estimate of the losses of the banking sector to the IMF, has still not formally initiated a return to the table of negotiations suspended since last year with the international institution due to the resistance of public and private financial institutions to even recognize the existence of significant financial losses, whether on the part of private banks or even the Banque du Liban, which unilaterally declared significant fiduciary profits to cover them.
The current difficulties in bringing together the government due to the political crisis induced by the indictment of several relatives of the President of the Chamber of Deputies as part of the ongoing investigation into the explosion in the port of Beirut on August 4 2020, could also delay the formal opening of negotiations and worsen the economic situation, failing to put in place the necessary reforms conditioning economic aid from the international community.
The new government estimates, however, that these losses reach 63 billion dollars against 83 billion dollars according to the former Diab government which hoped to obtain 10 billion dollars in economic aid. This reduction in the figures of financial losses could also induce a reduction in the aid that Lebanon could obtain, far below the target of 12 to 15 billion dollars today set by Riad Salamé, underlines some economists while the financial situation continues to deteriorate on the spot, with a Lebanese pound close to its historic low against the dollar and a continuous deterioration in purchasing power over the past 2 years.
The role of the Governor of the Banque du Liban in this crisis is also underlined by many people, in particular because of its monetary policy based on the artificial maintenance of an official parity since 1997 to attract capital to Lebanon at the same time reinvested. by banks in certificates of deposits or in public debt to the detriment of the real economy. Riad Salamé is also the subject of financial lawsuits in certain countries, such as in Switzerland or in France while the head of state, General Michel Aoun is about to formalize his request for departure because of these steps. judicial abroad even if it still enjoys the local support of the president of the chamber of deputies, Nabih Berri, that of the former prime minister Saad Hariri or of the former deputy Walid Joumblatt and the Maronite patriarch Béchara Boutros Rahi.
