IMF to send mission to Lebanon next week

Discussions to focus on Lebanon’s near-term priorities, reconstruction needs and economic developments, senior fund official says

UN vehicles drive past the rubble of destroyed buildings in the southern Lebanese village of Yaroun, near the border with Israel. AFP

The International Monetary Fund is sending a mission to Lebanon next week as the new government seeks to lift the country out of its protracted financial crisis, a senior fund official said on Thursday.

Describing mission from the March 10 to March 14 as a “fact-finding” one, IMF communications director Julie Kozack said the fund's staff will hold meetings with Lebanese authorities to discuss their near-term priorities, the country's reconstruction needs and recent economic developments.

“Our staff continues to be closely engaged with the authorities,” Ms Kozack told reporters at the fund's headquarters in Washington. “We are providing policy advice and capacity development to help the authorities' efforts to rebuild Lebanon's economy and institutions in co-ordination with other international partners.”

The new Lebanese government is expected to hold negotiations with the IMF for a new programme and a deal on Beirut's public debt and financial default, Reuters reported last month, citing a policy statement.

According to the report, Lebanon's government will seek to revive its economy by restructuring its banking sector.

Ms Kozack did not confirm if the IMF and Lebanon are in negotiations on a deal, but told The National that steps following the mission will help the new government “to formulate a comprehensive economic reform programme”.

At the conclusion of its Article IV consultations with Lebanon last year, IMF staff said that a lack of action on necessary economic reforms continued to “exert a heavy toll” on the country's economy and civilians.

Political developments in Lebanon have significantly changed in recent months, after the brutal conflict between Israel and Hezbollah. The World Bank estimates Lebanon suffered more than $5 billion in economic losses from the war.

In January, Lebanon's parliament elected army chief Joseph Aoun as President, ending a power vacuum that had lasted more than two years.

Lebanon, whose economy has been in crisis since 2019, reached a deal with the IMF in 2022 but failed to deliver on the contingent reforms.