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Lebanon Needs Foreign Support, Decision on Eurobond, Says Minister

Lebanon Needs Foreign Support, Decision on Eurobond, Says Minister

Wednesday, 22 January, 2020 - 05:45
People queue outside a bank in Tripioli, Lebanon November 1, 2019. (Reuters)
Asharq Al-Awsat
Lebanon's new government needs foreign support to help it get out of an unprecedented economic and financial crisis, the finance minister said on Wednesday.

Hours after he was named, Finance Minister Ghazi Wazni also said the government must decide on its approach to a $1.2 billion Eurobond maturing in March.

"The government must take a clear position on this because the previous government did not. It tossed over this ball of fire," Wazni told local broadcaster al-Jadeed.

Lebanon formed a new government on Tuesday after the Hezbollah party and its allies agreed on a cabinet that must urgently tackle the crisis.

Dollar shortages have led the pegged Lebanese pound to slump. People have lost jobs as inflation has soared. Tight banking controls have depositors worried for their savings and protesters turning their ire on the banks.

"We now have multiple crises that are very big and exceed by far those of the past," Wazni said. "We are in a state of collapse and if we continue this way, we will be in a phase of bankruptcy ... Today, people are at the doors of the banks begging for money."

Wazni, an economist who had served as an adviser to parliament's finance and budget committee, said the cabinet will have to come up with "a comprehensive rescue plan" to restore confidence.

Lebanon’s union of exchange dealers said on Tuesday it had decided to set the exchange rate at a maximum of 2,000 Lebanese pounds to the US dollar in agreement with the central bank governor.

The pound has been officially pegged at 1,507.50 to the dollar for more than two decades.

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