Exclusive - Lebanese Govt. Seeks to Solve Housing Loans Crisis to Promote Social Security

Exclusive - Lebanese Govt. Seeks to Solve Housing Loans Crisis to Promote Social Security

Monday, 17 September, 2018 - 09:45
Cranes are seen at a construction site at Beirut's central district in Lebanon January 4, 2017. (Reuters)
Beirut - Nazeer Rida
Lebanon has put forward a set of proposals to deal with the housing loans crisis, through the ministry of finance and the central bank (BDL), in an attempt to contain the growing problem that would threaten the country’s social security should it persist.

Well-informed Lebanese sources told Asharq Al-Awsat that the BDL will issue a support package to revitalize the economy in the 2019 fiscal year, which would include a portion dedicated to support housing loans.

Last week, the ministry of finance began working to resolve the crisis of housing loans, which have been frozen since March following the depletion of the support package provided by the BDL. Sixty percent of the package was earmarked for these loans.

BDL was using the funds to support low-interest housing loans offered to limited income families.

In a recent statement, Minister of Finance Ali Hassan Khalil reiterated his ministry’s approval to support subsidized housing loans, adding that the relevant legal mechanisms were being prepared and would be ready in a very short period of time.

A few days later, deputies from the Strong Republic parliamentary bloc submitted to Speaker Nabih Berri a draft-law to finance subsidized housing loans, “given the severe damage caused by the halting of loans to a large segment of the Lebanese society.”

The draft-law called for finding sources to subsidize the interest rate on housing loans offered by Lebanon’s Public Corporation for Housing (PCH), identify the beneficiaries and activate control on the application of conditions of use.

However, the crisis is not limited to the suspension of housing loans, as the housing policy as a whole must be treated.

Minister of State for Planning Affairs Michel Pharaon told Asharq Al-Awsat that the current crisis, which must be resolved, will not end the problems that emerged in wake of the absence of proper planning of the housing policy as a whole.

He emphasized the lack of adequate planning resulting from the absence of a comprehensive policy, noting that the public sector has not coordinated enough with banks, the central bank and some ministries.

Pharaon revealed that the current crisis affected many economic fields, “since the construction sector operates 34 associated sectors, which necessitates a solution to the housing loans crisis.”

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