Mikati: Lebanon’s talks with the IMF are going in the right direction

Lebanese Prime Minister Najib Mikati said on Monday that initial talks with the International Monetary Fund were going well, and that a revised recovery plan would be completed by the end of November.

Mikati added, at an economic conference in Beirut, “We presented unified numbers to the IMF and the negotiations are going in the right direction, and soon we will have a memorandum of understanding with him.”

Talks with the IMF aimed at obtaining financial support collapsed last year, amid disagreements over the extent of losses in Lebanon’s financial sector, which collapsed in late 2019.

The central bank, private banks and a parliamentary committee representing major political parties said the losses were much less than the roughly $83 billion estimated by the recovery plan, although the IMF sees the numbers as accurate.

Mikati said the central bank is cooperating fully with LAZARD, the advisory firm that helped develop the previous plan.

Economists believe that the IMF program is the only way for Lebanon to obtain international aid and start recovering from one of the worst financial crises in the world.

IMF conditions for negotiations with Lebanon

According to observers, the conditions for the IMF to negotiate with Lebanon are mainly as follows:

  • Unifying the dollar exchange rate and liberalizing it in the markets.
  • Provide estimates of financial losses in unified numbers between the Banque du Liban and the government (ie the Ministry of Finance).
  • Approving a comprehensive reform plan that includes restructuring the public sector.
  • Providing social protection networks.

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