World Bank renews its commitment to support Lebanon ‘financially, technically’

 World bank

BEIRUT: The World Bank renewed its commitment to support Lebanon “financially and technically,” during a meeting with the chair of Parliament’s Finance and Budget Committee, MP Ibrahim Kanaan, a statement from the latter’s office said Monday.

The World Bank delegation discussed with Kanaan the country’s economic situation, the 2020 budget and assessed the government’s commitment to the implementation of reforms in the 2019 budget, a statement from Kanaan’s office said.

The delegation, headed by Anna Bjerde, the director of strategy and operations for the Middle East and North Africa, stressed the importance of implementing the necessary reforms “especially in the electricity sector, reforming the public sector and public-private partnership projects to eventually reduce the deficit” to GDP ratio, the statement said.

Lebanon’s deficit-to-GDP ratio was lowered from 11.1 percent in 2018 to about 7.8 percent in the 2019 budget. However, global rating agencies disputed the percentage, predicting it will be 9 or 10 percent. State-run Electricite du Liban is responsible for a loss of $1.5 billion to $2 billion a year and fails to provide the country with an adequate power supply.

These deficits contribute to the growth of one of the world’s highest debt burdens, now around 150 percent of GDP.

Kanaan told the delegation that Lebanon’s Cabinet and Parliament are committed to implementing what was approved in the 2019 budget and what was decided in a recent meeting in Baabda Palace that brought together the country’s political leaders.

Lebanon is under mounting pressure to implement key structural economic and fiscal reforms to shore up its ailing economy and finances. The government pledged a series of reforms in return of the international community’s promise to support Lebanon with over $11 billion of grants and soft loans at last year’s CEDRE conference.