File photo: Lebanon’s Minister of Economy Amer Bisat
Lebanon’s Economy Minister Amer Bisat announced on Monday that depositors will eventually recover their funds, although the process may require time. His statement comes amid efforts to implement vital reforms to revive the country’s shattered financial system.
Speaking to Bloomberg, Bisat expressed confidence that Lebanon’s parliament would soon pass a long-awaited draft law to restructure the country’s banking sector. The cabinet had already given the green light to the proposed legislation over the weekend, a move considered essential for unlocking international financial assistance.
According to Bisat, the financial burden of the crisis will be primarily borne by three parties: the Lebanese state, the central bank, and local financial institutions. This restructuring is expected to play a key role in addressing the massive losses caused by the economic meltdown that began in 2019.
A high-level Lebanese delegation, including newly appointed central bank governor Karim Souaid, is set to meet with International Monetary Fund officials later this month during World Bank meetings in Washington.
Photo: A damaged ATM is pictured in Beirut, Lebanon, March 17, 2021. The financial collapse of Lebanon resulted in depositors largely being shut out of their savings and the local currency losing 99% of its value. Poverty in Lebanon has more than tripled over the past 10 years, with the overall proportion of the country’s population living below the poverty line is soaring , according to the World Bank.
Since 2019, Lebanon has been grappling with a severe financial collapse that saw the Lebanese pound lose most of its value against the dollar and left many citizens unable to access their bank savings. The crisis, largely attributed to years of mismanagement and corruption, plunged much of the population into poverty.
In response, the international community has consistently pressed for comprehensive fiscal reforms as a condition for releasing billions in aid to help stabilize the Lebanese economy.
President Joseph Aoun emphasized on Monday that reform is not merely about meeting external demands but is crucial for securing the country’s future. He insisted that rebuilding trust in Lebanon’s economy requires action that benefits its citizens, not just foreign partners.
(The Daily Star)