Lebanon’s new PM pledges to stabilize economic meltdown – KIRO 7 News Seattle


BEIRUT – (AP) – The new Lebanese prime minister on Friday pledged to take control of one of the world’s worst economic collapses, saying the lifting of subsidies was a key priority for the small country’s government formed after a year of political stalemate .

It is a momentous task for the cabinet of 24 ministers that includes new faces who are prominent experts in their fields but still reflect Lebanon’s divided politics.

The country’s economic crisis, which has been spreading since 2019, is described as one of the worst in the world in the last 150 years. It impoverished more than half of the population in a matter of months, leaving the local currency in free fall, propelling inflation and unemployment to unprecedented levels.

By the end of the month, the new administration is expected to initiate much-needed reforms and to deal with public anger and tensions arising from the lifting of fuel subsidies. Lebanon’s foreign exchange reserves are dangerously low, and the import-dependent country’s central bank said it was no longer able to support its $ 6 billion subsidy program.

The government is also expected to oversee a central bank financial audit and resume negotiations with the International Monetary Fund on a rescue package.

Few believe this is possible with a government that leaves power in the hands of the same political parties that blame the public for corruption and mismanagement of the country’s resources.

“The biggest winners are the political parties combined,” said Maha Yahya, director of the Carnegie Middle East Center in Beirut. “It is very clear that it is the epitome of business as usual. Everyone in this cabinet was named by the political leadership. Some are more competent than others. But the political decision-making lies elsewhere. “

After more than a year of fighting between political rivals over the form of government, a sudden breakthrough was reported early Friday and the new line-up in the presidential palace was announced.

Experts and politicians say a final push to Lebanon’s rival parties to compromise may have come from the country’s equally divided international supporters – the United States, France and Iran – after Lebanon’s economic collapse reaches a critical point who risked a social explosion. A crippling shortage of fuel and medicine threatened to shut down hospitals, bakeries, and the country’s internet, creating friction, sometimes violence, in long lines to refuel vehicles.

Returning to the post of Prime Minister for the third time, Mikati, one of Lebanon’s richest businessmen, has sent a message to the weary and exhausted public that he is hearing their pain.

Mikati held back tears, saying he recognized the pain of Lebanese mothers who cannot feed their children or find aspirin to relieve their discomfort, as well as students whose parents can no longer afford to send them to school.

“We hope to get what people want and at least stop the collapse,” he told reporters at the presidential palace.

The deal breaks a 13-month dead end, one of the longest periods in Lebanon without a fully functioning government at a time when the country slipped deeper into financial chaos and poverty.

The Lebanese government resigned after the catastrophic explosion in the port of Beirut on August 4, 2020, which killed more than 200 people and mutilated the city. The economic collapse was exacerbated by the blockade of rival political groups.

Mikati became a favorite for the post earlier this year after being backed by most of Lebanon’s political parties, including the powerful Iranian-backed militant Hezbollah group and the other major Shiite party, Amal, led by Parliament Speaker Nabih Berri. He succeeded former Prime Minister Saad Hariri, who gave up efforts to form a government after eight months after failing to come to an agreement with President Michel Aoun on the composition of the cabinet.

The power struggle in Lebanon’s sectarian system revolved around which group has a blocking vote on politics at a time of much-needed reform. But it also reflected the growing power of Hezbollah and its allies at the expense of the once powerful, Western-backed Sunni and Christian parties.

US Senators visited Lebanon earlier this month while a senior State Department official spoke to the Lebanese President and Mikati, calling for a government to be formed. Separately, French President Emmanuelle Macron called the newly elected Iranian President Ebrahim Raisi, who said he supported the formation of a “strong government in Lebanon”.

“The American embassy has really pushed the formation of a government,” said Alain Aoun, a lawmaker who represents the largest Christian bloc near the Lebanese president, while the same message came from the Iranian president in a phone call to Macron.

Both were messages that recognized the reality on the ground in Lebanon and signaled that support would come once a government is formed to contain the rapid collapse, said Salem Zahran, a political analyst.

“This is the best that can happen to Hezbollah,” said Zahran. The group has allies in both the Ministry of Public Works and Utilities – which oversees the airport and port – and the Ministry of Culture.

Many of the members of the new cabinet are experts in their field. Firas Abiad, Director General of Rafik Hariri University Hospital, who has been recognized for his transparency in dealing with the pandemic, has been appointed Minister of Health. A top central bank official, Youssef Khalil, has been appointed finance minister and Bassam Mawlawi, a judge, is the new interior minister.

Yahya, the analyst, said Mikati is having an uphill battle with a government that has no common goal.

“This government is like an injection of morphine. Anyway, some money will come in … but that’s all short term. The country is still not on a sustainable recovery path. “

The audience was mostly skeptical, if a little relieved.

Ali Sharafeddine, who owns a company that sells power generators, said the new government is no different from previous ones formed by the same political groups that ruined Lebanon.

“They are just faking us,” said 51-year-old Sharafeddine.