LEvanon A “day away” from a “social explosion”. So, on July 6, Acting Prime Minister Hassan Diab said. The country is in danger of a plunge in the value of its local currency and a shortage of food, fuel and medicines for many of its populations. “I am calling on the kings, princes, presidents and leaders of friendly nations, and I am calling on the United Nations and all international organizations to support relief from the end of Lebanon,” said Diab, a foreign diplomat. Told the group.
But foreign leaders are not listening. Most people do not trust Lebanese politicians. Mr. Diab has served as a caretaker since the catastrophic explosion at the port of Beirut last August (as a result of government negligence). For almost a year, politicians in the infamous corrupt countries, divided by denominations, were unable to agree on a new government and carry out the reforms required by foreign leaders.
Even if Congress seems to be doing something right, its intentions are questionable. Plan to replace the recently passed affordable subsidies for food, fuel and medicine with a $ 556 million cash aid program for the poor.In a sense, it is the central bank of Lebanon (Banque du Liban, or BdL) The reserves needed to support the subsidy system will soon run short. (In the scheme BdL Sell dollars to the importer of the target product at a price below the market price. ) The World Bank was right and BdL This year we are removing or reducing subsidies.
The old system may have been more targeted, as the wealthy Lebanese consumed more grants than the poor. However, new systems that have not yet been implemented are opaque. It is not clear who is eligible for assistance. Anyway, few people think that Lebanese politicians will distribute it fairly. They have a history of handing out government tycoons to relatives and supporters (elections are scheduled for next year). The contract goes to the connected one and leads to an unreliable service. Due to poor management of the aging power grid, it is appropriate for sweaty legislators to pass a financial assistance program in Congress without air conditioning.
How the cash aid program is funded is also an open question. The central bank can pay for it, but it is short of reserves and printing more pounds will increase inflation and it is already empty. External funding may be an option. Lebanon, for example IMF Donates to poor countries to support the covid-related economic slowdown. The money will be delivered by the fall. Some officials want to redistribute the loans already offered by the World Bank for other purposes.
The World Bank probably doesn’t care if much of its money is actually used to directly support the poor. But it lacks patience for the government. In January, the bank agreed to lend $ 246 million to Lebanon to expand its social safety net, including cash transfers to the poor. If the government has done so, funding the program more will be an option. It has been stalled for months due to disagreements between World Bank and Lebanese politicians about who gets help and how it is paid. In short, politicians do not like the idea of World Bank surveillance.
In the coming weeks, the government will provide detailed plans for financing and implementing new aid programs. But the people of Lebanon are not holding their breath. With increasing poverty and failure of basic services, politicians appear to be more interested in protecting the sponsoring system that caused the crisis. Isn’t it strange that Mr. Diab’s plea was deaf? ■■
This article was published in the printed Middle East and Africa section under the heading “Begging for help”.