Lebanon’s PM Says IMF Talks Progressing Well

FILE PHOTO: Lebanese Prime Minister Najib Mikati speaks during an interview with Reuters at the government palace in Beirut, Lebanon October 14, 2021. REUTERS/Mohamed Azakir
FILE PHOTO: Lebanese Prime Minister Najib Mikati speaks during an interview with Reuters at the government palace in Beirut, Lebanon October 14, 2021. REUTERS/Mohamed Azakir
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Lebanon’s PM Says IMF Talks Progressing Well

FILE PHOTO: Lebanese Prime Minister Najib Mikati speaks during an interview with Reuters at the government palace in Beirut, Lebanon October 14, 2021. REUTERS/Mohamed Azakir
FILE PHOTO: Lebanese Prime Minister Najib Mikati speaks during an interview with Reuters at the government palace in Beirut, Lebanon October 14, 2021. REUTERS/Mohamed Azakir

Lebanon’s Prime Minister Najib Mikati said on Monday that preliminary talks with the International Monetary Fund were advancing well and a revised financial recovery plan would be complete by the end of November.

“For the first time we have handed over unified financial figures,” Mikati told an economy conference in Beirut. “We hope we will have a letter of intent soon.”

Talks with the IMF that aimed to secure financial support broke down last year amid disagreements over the scale of losses in the country’s financial sector that collapsed in late 2019, Reuters reported.

The central bank, private banks and a parliamentary committee representing major political parties argued that losses were much smaller than the roughly $83 billion estimated by the plan, despite the IMF viewing the figures as accurate.

Mikati said the central bank was now “cooperating fully” with Lazard, the advisor that helped draw up the previous plan, adding that the updated version would be ready this month.

Economists see an IMF program as the only way for Lebanon to unlock international aid and begin recovering from one of the world’s worst financial crises.

The economic meltdown has translated into severe shortages of basic goods including fuel and medication.

Mikati said Lebanon was seeking to increase electricity output from a current five hours per day to between 10 and 15 hours per day by the end of the year through a series of deals with Iraq, Egypt and Jordan.

Lebanon’s ailing electricity sector constitutes a main drain on state finances, costing taxpayers more than $40 billion since 1992 even though the state never provided round-the-clock power.

In addition to monthly shipments of 75,000 tonnes of crude oil from Iraq that provide about five hours a day of power, Mikati said Lebanon aimed to secure Egyptian gas to produce an additional four hours of power by the end of the year.

He said Jordan was willing to provide about two hours worth of power for a cost of 12 cents per kilowatt hour (kWh), and work was underway on a long-term plan to secure 24/7 electricity.

While Mikati struck an optimistic tone, his government has not met for nearly a month due to a row over the probe into the deadly August 2020 Beirut port blast and will lose decision-making powers after elections scheduled for spring next year.

Mikati said “no-one can prevent the holding of elections,” before parliament’s mandate ends on May 21.



Saudi Arabia Pushes Owners of White Land to Revive Properties, Boost Supply

 A housing project in Saudi Arabia (Asharq Al-Awsat)
A housing project in Saudi Arabia (Asharq Al-Awsat)
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Saudi Arabia Pushes Owners of White Land to Revive Properties, Boost Supply

 A housing project in Saudi Arabia (Asharq Al-Awsat)
A housing project in Saudi Arabia (Asharq Al-Awsat)

Real estate experts have described the Saudi Cabinet's decision to amend the White Land Tax system as a significant shift in balancing the supply and demand of the property market.
The move is expected to influence investor and landowner behavior, encouraging them to develop their properties and increase the availability of residential units, thereby revitalizing real estate development projects.
It will also support government efforts to accelerate urban development and offer diverse housing solutions.
The experts predict that the effects of this amendment will begin to be felt in the real estate market by the third quarter of 2025, with the most significant impact expected in the first half of 2026, as a higher number of properties fall under the tax.
On Tuesday, the Saudi Cabinet approved the amendment to the White Land Tax system, following directives from Crown Prince Mohammed bin Salman in March to take urgent action within 60 days to address the white land crisis.
The goal is to increase land supply, curb price inflation, balance supply and demand, and provide affordable residential land.
The recent amendments to Saudi Arabia's White Land Tax system introduce three phased implementation stages. The first phase targets undeveloped land measuring 10,000 square meters or more, located within a designated area set by the Ministry.
The second phase includes developed land of the same size, as well as developed land owned by a single entity within a single plot.
The third phase addresses developed land of at least 5,000 square meters, along with a total of 10,000 square meters or more of developed land owned by a single entity within a city, within the designated area.
The changes also allow for multiple phases to be applied within a single city. The Ministry will periodically review the situation in each city to determine whether to impose, suspend, or adjust the tax phases, allowing cities to bypass a stage and move to the next when necessary.
Currently, the White Land Tax is being implemented in Riyadh, Jeddah, Dammam, and Makkah as part of its first phase, with a total of approximately 5,500 payment orders covering over 411 million square meters of land. The program recently expanded to include several other cities, including Madinah, Asir, Jazan, Taif, and Tabuk.
Real Estate Development
Commenting on the decision, real estate consultant and expert Al-Aboudi Bin Abdullah told Asharq Al-Awsat that the move marks a significant shift in balancing supply and demand within the real estate market.
He highlighted that the system’s transition from fixed, low-impact fees (set at 2.5%) to a more dynamic, incentivizing tool could see fees rise up to 10%, depending on development progress and land use.
The inclusion of vacant properties under the tax and the consolidation of tax stages will help address the issue of land hoarding within cities, while also expanding the range of land that can be developed within urban boundaries.
Bin Abdullah believes the amendments will address several challenges, including land hoarding and urban stagnation caused by undeveloped plots held for years.
Additionally, the new system aims to reduce the unjustified rise in land prices, curb urban distortions due to vacant plots in fully developed areas, and accelerate both residential and commercial development projects by offering better incentives for land activation.
The changes are expected to increase the supply of land and developed projects in the coming periods, gradually lowering the prices of some white land, particularly in major cities.
This will encourage developers to focus on actual construction rather than holding land passively, while also supporting the government's efforts to speed up urban development and provide a broader range of housing options.
Bin Abdullah predicts that the initial effects of these changes will be felt by the third quarter of 2025, especially once the 90-day registration deadline for white land passes and a year has passed since vacant properties were first registered.
However, the most significant impact on land prices and availability will likely become evident in the first half of 2026, as more properties fall under the tax’s scope.
Investor Behavior Shift
Meanwhile, Khaled Almobid, CEO of Menassat Real Estate, told Asharq Al-Awsat that the current rise in property prices is detrimental to developers, end-users, and the economy, especially in the long term.
He views the amendments to the White Land Tax as a positive step for the real estate market, coming at a timely moment to tackle the sector's challenges.
Almobid emphasized that the primary objective of the changes is to shift investor behavior.
The amendments are designed to encourage investors to move away from using white land as a store of wealth and instead focus on developing these properties, thereby increasing the supply of residential units in the market.
He added that the changes will revitalize development projects, creating jobs across around 150 sectors that work in parallel with the real estate industry, benefiting the overall economic system in cities covered by the White Land Tax.
Almobid also pointed out that the inclusion of vacant properties under the tax is a crucial development.
This measure creates an incentive for property owners and developers to retain tenants, thus preventing vacancies and avoiding further tax burdens.
The move is expected to reduce the previously common practice of raising rents without considering tenants’ financial capabilities.