IMF: Lebanon's Reforms Insufficient for Recovery

Lebanese policeman stand outside the parliament building in downtown Beirut, Lebanon October 17, 2017. REUTERS/Mohamed Azakir
Lebanese policeman stand outside the parliament building in downtown Beirut, Lebanon October 17, 2017. REUTERS/Mohamed Azakir
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IMF: Lebanon's Reforms Insufficient for Recovery

Lebanese policeman stand outside the parliament building in downtown Beirut, Lebanon October 17, 2017. REUTERS/Mohamed Azakir
Lebanese policeman stand outside the parliament building in downtown Beirut, Lebanon October 17, 2017. REUTERS/Mohamed Azakir

Lebanon's economic reforms are insufficient to help lift the country out of its economic crisis, the International Monetary Fund (IMF) said on Thursday.

Ernesto Ramirez Rigo, the head of the IMF mission visiting Lebanon, said in a statement that Lebanon's ongoing refugee crisis, fighting with Israel at its Southern border and the spillover from the war in Gaza are exacerbating an already dire economic situation.

Israeli forces and Lebanon's Hezbollah have traded fire across Lebanon's southern border since the war in Gaza broke out in October last year.

The conflict "has internally displaced a significant number of people and caused damage to infrastructure, agriculture, and trade in southern Lebanon. Together with a decline in tourism, the high risks associated with the conflict create significant uncertainty to the economic outlook," Rigo said, Reuters reported.
Fiscal and monetary reforms carried out by Lebanon's finance ministry and the central bank, including steps to unify multiple exchange rates for the Lebanese pound and contain a currency slump, have helped reduce inflationary pressure, according to Rigo.

However, he said more needs to be done if Lebanon is to alleviate its financial crisis.

"These policy measures fall short of what is needed to enable a recovery from the crisis. Bank deposits remain frozen, and the banking sector is unable to provide credit to the economy, as the government and parliament have been unable to find a solution to the banking crisis," he added.

"Addressing the banks' losses while protecting depositors to the maximum extent possible and limiting recourse to scarce public resources in a credible and financially viable manner is indispensable to lay the foundation for economic recovery."

Since Lebanon's economy began to unravel in 2019, its currency has lost around 95% of its value, banks have locked most depositors out of their savings and more than 80% of the population has sunk below the poverty line.

The crisis erupted after decades of profligate spending and corruption among the ruling elite, some of whom led banks that lent heavily to the state.

The government estimates losses in the financial system total more than $70 billion, the majority of which were accrued at the central bank.

 

 

 

 

 



Russia Hikes Import Tariffs for Consumer Goods from 'Unfriendly Countries'

A Russian national tricolor flag flutters on a tourist boat as another boat passes by along the Moskva river in central Moscow on July 18, 2024. (Photo by Natalia KOLESNIKOVA / AFP)
A Russian national tricolor flag flutters on a tourist boat as another boat passes by along the Moskva river in central Moscow on July 18, 2024. (Photo by Natalia KOLESNIKOVA / AFP)
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Russia Hikes Import Tariffs for Consumer Goods from 'Unfriendly Countries'

A Russian national tricolor flag flutters on a tourist boat as another boat passes by along the Moskva river in central Moscow on July 18, 2024. (Photo by Natalia KOLESNIKOVA / AFP)
A Russian national tricolor flag flutters on a tourist boat as another boat passes by along the Moskva river in central Moscow on July 18, 2024. (Photo by Natalia KOLESNIKOVA / AFP)

Russia increased imports tariffs for consumer goods, including candies, biscuits and shampoo, produced in countries that support sanctions against Moscow, according to a government order published late on Friday.

Russian imports from nations that imposed sanctions against Moscow over its military conflict with Ukraine slumped in 2022.

Some Western producers stopped selling to Russia, but Moscow has found roundabout ways to keep goods coming, including a grey imports scheme, and plenty of foreign goods remain on store shelves.

According to the order, the tariffs for perfume, cosmetics and shampoo from Poland, for example, will amount to 35% of the customs value. Duties for wallpapers from Lithuania, Latvia and Estonia will rise to 50%.

The new tariffs will be in place until and including Dec. 31 2024 and take effect seven days after publication.