IMF welcomes new Lebanon government request for help

WASHINGTON

The International Monetary Fund has welcomed the new Lebanese government's request for support in addressing severe economic challenges.

Lebanon in January elected a new president after a more than two-year vacuum, and then formed a government led by Prime Minister Nawaf Salam.

In February the IMF said it was open to a new loan agreement with the country following discussions with its recently-appointed Finance Minister.

The previous caretaker administration did not enact reforms the IMF had demanded to implement a loan package to save the collapsed economy.

The world lender "welcomed the authorities' request for a new IMF-supported program to bolster their efforts in addressing Lebanon's significant economic challenges", the IMF said in a statement.

Lebanon's economic crisis has pushed most of the population below the poverty line, according to the United Nations.

In April 2022, Lebanon and the IMF reached conditional agreement on a $3-billion-dollar loan package but painful reforms that the 46-month financing program would require have not been undertaken.

Ernesto Ramirez Rigo, the head of the IMF's delegation to Lebanon pointed to positive steps including the stabilisation of the dollar exchange rate and reduced inflation.

But he said these were "insufficient to address the ongoing economic, financial, and social challenges.”

The cost of reconstruction and recovery for Lebanon following the 14-month Israel-Hezbollah war is estimated at $11 billion, the World Bank said in a report earlier this month.