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.