Lebanon Reels After Efforts to Form Government Collapse

"My country did this", reads graffiti daubed on walls near the site of a colossal August 4 blast in Beirut that killed 190 people and ravaged large parts of the Lebanese capital | AFP
"My country did this", reads graffiti daubed on walls near the site of a colossal August 4 blast in Beirut that killed 190 people and ravaged large parts of the Lebanese capital | AFP
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Lebanon Reels After Efforts to Form Government Collapse

"My country did this", reads graffiti daubed on walls near the site of a colossal August 4 blast in Beirut that killed 190 people and ravaged large parts of the Lebanese capital | AFP
"My country did this", reads graffiti daubed on walls near the site of a colossal August 4 blast in Beirut that killed 190 people and ravaged large parts of the Lebanese capital | AFP

Lebanon was left reeling Sunday without the slightest prospect of ending multiple crises, after its premier-designate stepped down following the failure of talks to form a government, despite international pressure.

Mustapha Adib's resignation on Saturday ended efforts to hammer out a reformist government in the wake of a colossal August 4 explosion in Beirut that killed 190 people, injured thousands, and ravaged large parts of the capital.

Political parties had pledged in early September, during a visit to Lebanon by French President Emmanuel Macron, to form within two weeks a cabinet of independent ministers tasked with ending the country's economic malaise.

"As the efforts to form a government reached their final phase, it became apparent to me that this consensus... was no longer there," Adib said on Saturday.

Under the Lebanese constitution, the president must now hold further talks to nominate another prime minister to form a government, but it is a process that risks dragging out and even failing.

"I don't expect a government anytime soon," said Sami Atallah, who heads the Lebanese Center for Policy Studies.

"There was a chance, there was a lot of pressure to form a government and it didn't happen," he said, adding there was a "bigger problem" of geopolitical tensions, especially between the United States and Iran.

Adib's efforts were hampered by the claims of two Shiite formations, the Iran-backed Hezbollah movement, and its ally Amal, led by parliament speaker Nabih Berri, who demanded the finance portfolio.

According to observers, the Shiite allies dug in their heels after recent US sanctions imposed on a minister of the Amal party and two companies affiliated with Hezbollah.

- 'Into the unknown' -

Adib's decision to step aside 26 days after his appointment has left the people of Lebanon feeling as though they are back to square one.

Earlier this week, Lebanese President Michel Aoun warned the country was headed to "hell" unless all political parties stepped up and facilitated the formation of a government.

Even before the devastating Beirut port blast, the country was already mired in its worst economic crisis in decades and mass protests that toppled and replaced the government.

Following the August 4 blast, the country's worst peacetime disaster, the government stepped down and Adib was appointed to form a new one.

Many are worried the country is headed from bad to worse.

The UN envoy to Lebanon, Jan Kubis, on Saturday reacted with disbelief: "Such a degree of irresponsibility, when the fate of Lebanon and its people is at stake!"

"Politicians, have you really scuppered this unique chance created by France?"

Analyst Karim Bitar said Lebanon was expected to have a rough patch ahead.

"Even if Lebanon is not hell-bound, we will probably witness... the weakening of public institutions, a worsening of the economic crisis... and a wave of emigration," he said.



Where Do Trade Talks Stand in the Rush to Avert Higher US Tariffs?

FILE PHOTO: A container is loaded onto a cargo ship while docked at Hai Phong port, after US President Donald Trump announced a 90-day pause on tariffs for many countries, in Hai Phong, Vietnam, April 16, 2025. REUTERS/Athit Perawongmetha/File Photo/File Photo
FILE PHOTO: A container is loaded onto a cargo ship while docked at Hai Phong port, after US President Donald Trump announced a 90-day pause on tariffs for many countries, in Hai Phong, Vietnam, April 16, 2025. REUTERS/Athit Perawongmetha/File Photo/File Photo
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Where Do Trade Talks Stand in the Rush to Avert Higher US Tariffs?

FILE PHOTO: A container is loaded onto a cargo ship while docked at Hai Phong port, after US President Donald Trump announced a 90-day pause on tariffs for many countries, in Hai Phong, Vietnam, April 16, 2025. REUTERS/Athit Perawongmetha/File Photo/File Photo
FILE PHOTO: A container is loaded onto a cargo ship while docked at Hai Phong port, after US President Donald Trump announced a 90-day pause on tariffs for many countries, in Hai Phong, Vietnam, April 16, 2025. REUTERS/Athit Perawongmetha/File Photo/File Photo

As a Wednesday deadline approaches for steeper US tariffs to hit dozens of economies ranging from the EU to India, trade negotiations with President Donald Trump's administration are coming down to the wire.

The levies taking effect July 9 were announced in April, with the White House citing a lack of "reciprocity" in trade relations. But they were swiftly halted, allowing room for talks.

Days before their reimposition, where do things stand?

EU: 'Ready' for deal

The European Union said it is "ready for a deal" with Washington, with the bloc's trade chief meeting his US counterparts Thursday.

European Commission president Ursula von der Leyen said the EU was targeting an "agreement in principle" when it came to the July 9 cutoff, AFP reported.

With no deal, the US tariff on EU goods doubles from the "baseline" of 10 percent to 20 percent -- with Trump previously threatening a 50 percent level.

Vietnam: A pact with uncertainties

Washington and Hanoi unveiled a trade pact Wednesday with much fanfare and few details, but it allowed Vietnam to avoid Trump's initial 46 percent tariff.

Under the agreement, Vietnamese goods face a minimum 20 percent tariff while products made elsewhere face a 40 percent levy -- a clause to restrict "transshipping" by Chinese groups.

But there remain questions on how the higher levy would apply to products using foreign parts.

There is also a risk that Beijing will adopt retaliatory measures, analysts warned.

Japan: Rice, autos at stake

Despite being a close US ally and major source of foreign investment, Japan might not escape Trump's tariff hike.

Tokyo's trade envoy Ryosei Akazawa has made numerous trips to Washington through the end of June.

But Trump recently criticized what he described as Japan's reluctance to open up further to US rice and auto exports.

"I'm not sure we're going to make a deal," Trump said, adding that the country could pay a tariff of "30 percent, 35 percent, or whatever the number is that we determine."

India: A good position

Indian manufacturers and exporters want to believe they can avoid a 26 percent tariff.

Negotiations between both countries have been going well for weeks, and Trump himself suggested at the end of June that a "very big" agreement was imminent.

Ajay Sahai, director general of the Federation of Indian Export Organizations, said the feedback he received "suggests positive developments." But he maintained that the situation was fluid.

Finance Minister Nirmala Sitharaman has stressed that agriculture and dairy products remain "very big red lines."

South Korea: Muted optimism

Seoul, which is already reeling from US tariffs on steel and autos, wants to avert a sweeping 25 percent levy on its other exports.

Cooperation in shipbuilding could be a bargaining chip, but "at this stage, both sides still haven't clearly defined what exactly they want," said new President Lee Jae Myung on Thursday.

"I can't say with confidence that we'll be able to wrap everything up by July 8," he added.

Indonesia, Thailand, Taiwan in the wings

Other Asian economies including Indonesia, Thailand and Cambodia, which faces a 49 percent tariff, wait with bated breath.

Indonesia has indicated willingness to boost energy, agriculture and merchandise imports from the United States. Bangladesh meanwhile is proposing to buy Boeing planes and step up imports of US agriculture products.

Taiwan, for whom Washington is a vital security partner, faces a 32 percent duty without a pact.

Although both sides have faced bumps along the way, Taiwanese Vice President Hsiao Bi-khim said "negotiators from both sides are working diligently" to find a path forward.

Switzerland: Hope for delay

Switzerland's government said Washington has acknowledged it was acting in good faith, and assumes its tariff level will remain at 10 percent on July 9 while negotiations continue.

But without a decision by the president as of the end of June, Switzerland did not rule out that levies could still rise to a promised 31 percent.