Lebanon’s political and economic crisis is so profound that the nation risks total collapse, France’s foreign minister has warned ahead of a second visit by French President Emmanuel Macron next week.
Mr Macron, the first world leader to visit Beirut after the devastating explosion earlier this month, reprimanded Lebanese leaders and called for the enactment of economic and political reforms that he said France had advocated for years.
The blast in Beirut port that killed at least 180 and injured around 6,000 was seen as a symptom of widespread corruption and mismanagement that had already pushed the country into financial crisis.
It was caused when 2,700 tonnes of ammonium nitrate ignited after a fire started in the warehouse where it had been stored for six years without safety measures.
Entire neighbourhoods were pulverised when the chemicals detonated with what explosives experts described as the power of a small nuclear weapon.
In the wake of the devastation, protesters have raged against Lebanon’s political elite in anti-government rallies. An investigation published yesterday by Human Rights Watch said Lebanese security forces had responded with "excessive and, at times, lethal force", firing live ammunition, metal pellets and rubber bullets. The finding was denied by the Internal Security Forces, the Lebanese Army and police.
"This country is on the brink," French Foreign Minister Jean-Yves Le Drian said on RTL radio, citing growing poverty, unemployment and inflation. "The risk today is the disappearance of Lebanon," he said, if it did not urgently form a government and institute reforms.
Mr Le Drian was reiterating the French position, broadly supported by the international community, that funds would not come without institutional change.
"We will not sign a blank check for a government that does not implement reforms," he said.
His comments were made amid reports that the administration in Paris has created a roadmap for Lebanon advocating far-reaching reforms to avert economic disaster.
The details of Paris’s desired path for Lebanon, a former French protectorate, have been outlined in a two-page paper seen by Reuters.
The document was delivered to Beirut by France’s ambassador to the country, a Lebanese political source has said. Mr Macron’s office has denied that the paper was handed over to Lebanese parties.
According to the news agency, the measures proposed an audit of the central bank, appointment of an interim government capable of enacting urgent reforms, and early legislative elections within a year.
“The priority must go to the rapid formation of a government, to avoid a power vacuum which will leave Lebanon to sink further into the crisis,” the French document reads.
It outlines how four distinct crises require immediate action: humanitarian aid, which includes the response to the coronavirus pandemic, reconstruction, political and economic reforms, and early elections within a year.
Paris is also calling for an immediate and full audit of state finances and the central bank.
The French roadmap would also increase Paris’s involvement in the country. France, under the plans, would play a major role in rebuilding Beirut port, bolster healthcare, send teams from its treasury and central bank to support the financial audit, and help organise early parliamentary voting, along with the European Union.
Thanksgiving meals to try
World Cut Steakhouse, Habtoor Palace Hotel, Dubai. On Thursday evening, head chef Diego Solis will be serving a high-end sounding four-course meal that features chestnut veloute with smoked duck breast, turkey roulade accompanied by winter vegetables and foie gras and pecan pie, cranberry compote and popcorn ice cream.
Jones the Grocer, various locations across the UAE. Jones’s take-home holiday menu delivers on the favourites: whole roast turkeys, an array of accompaniments (duck fat roast potatoes, sausages wrapped in beef bacon, honey-glazed parsnips and carrots) and more, as well as festive food platters, canapes and both apple and pumpkin pies.
Ruth’s Chris Steakhouse, The Address Hotel, Dubai. This New Orleans-style restaurant is keen to take the stress out of entertaining, so until December 25 you can order a full seasonal meal from its Takeaway Turkey Feast menu, which features turkey, homemade gravy and a selection of sides – think green beans with almond flakes, roasted Brussels sprouts, sweet potato casserole and bread stuffing – to pick up and eat at home.
The Mattar Farm Kitchen, Dubai. From now until Christmas, Hattem Mattar and his team will be producing game- changing smoked turkeys that you can enjoy at home over the festive period.
Nolu’s, The Galleria Mall, Maryah Island Abu Dhabi. With much of the menu focused on a California inspired “farm to table” approach (with Afghani influence), it only seems right that Nolu’s will be serving their take on the Thanksgiving spread, with a brunch at the Downtown location from 12pm to 4pm on Friday.
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Our family matters legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer