Responding to a question about Lebanon, the spokesperson for the International Monetary Fund called for the 860 million dollars in special drawing rights that should be paid to Lebanon within 2 months to be put to good use. He also commented on the announcement of the withdrawal of Prime Minister designate Saad Hariri and called for the rapid establishment of a government to carry out the necessary reforms while the social and economic situation continues to deteriorate there.
Gerry Rice’s response
Question: About the resignation of the Prime Minister designate, and what is the IMF’s point of view on this financial resignation based on a disagreement on the choices of the cabinet and how this will affect the situation in Lebanon?
MR RICE: Well, I would say that on Lebanon, we continue to be engaged with the authorities and the discussions at the technical level are continuing. We look forward to the formation of a new government with a mandate to implement reforms and deal with the worsening crisis, which is causing worsening conditions and growing poverty.
And we’ve already said what we think these policies need to do to restore macroeconomic stability and pave the way for investment, jobs and growth. So, again, I would say we look forward to the formation of a new government and the discussions that would follow.
There is actually another question about Lebanon that I want to answer, which concerns – the IMF Executive Director for the Arab Republic of Egypt, Mahmoud Mohieldin, was quoted by Lebanese officials. He meant that $ 860 million will be allocated to Lebanon as part of the SDR allocations after two months. Can you confirm how much Lebanon would receive from this money? How can Lebanon use this money?
I can confirm that the amount mentioned is roughly correct. That is – once the allocation is approved, which has not happened yet, we will get a new SDR allocation of approximately $ 860,000,000. Again, this can change a bit depending on exchange rates etc.
And in regards to their use, we will provide advice to our member authorities, not just in Lebanon, but all of our member countries on how best to use SDRs in a manner consistent with macroeconomic sustainability. And above all, transparently.
So, again, it is very important to know how these SDRs would be put to good use to strengthen a country’s reserves; create space for urgent priority spending; and support better policies.