The timing couldn’t be worse. In recent weeks, Lebanon, one of the most indebted country, has fallen into chaos after decades of economic mismanagement.
Crime rises as desperate Lebanese search for scarce staples like food and medicine, while others look to a swarm online barter economy to survive – clothes for formula? The deepening economic crisis recently pushed at least 500,000 children to Beirut in poverty, warned an aid group in July.
International observers, meanwhile, wondered if Lebanon had not already passed the “failed state” threshold.
International support. So far, countries like Australia, Canada, France, Israel, Norway, Turkey and the Netherlands have provided Beirut with emergency humanitarian aid in the form of generators, medical supplies and supplies. personal, and even money. The EU, for its part, is Sending in progress search and rescue teams to search for survivors, while French President Emmanuel Macron will land in Beirut on Thursday to support his country’s former colony.
While immediate humanitarian aid has been provided – and encouraging – aid itself is unlikely to pull Lebanon from the brink. There are several reasons for this.
First, humanitarian aid is one thing, but financial lifelines are another. Even before the pandemic crippled the global economy, the World Bank predicted that 50 percent of Lebanese could live below the poverty line if current trends continue. Hoping to avoid its worst economic crisis since the end of the 15-year civil war in 1990, Beirut has since appealed to international creditors like the International Monetary Fund (IMF) for a massive $ 10 billion in financial assistance. dollars, but the IMF refused to play the game unless the Lebanese government reforms its bloated, inefficient and corrupt public sector. So far, the powerful in Beirut have resisted.
The reformist will is the key. Even if the IMF nods and distributes funds to cash-strapped Lebanon, what happens when the money gets there? The patronage-ridden Lebanese public sector and corrupt politicians, many of whom former warlords sectarian groups have mismanaged the country’s economy for decades, lining their pockets as the middle class plunged into poverty. IMF support does not solve long-term problems such as government paralysis, poverty and social instability which, experts warn, can only be alleviated through structural reforms.
The Hezbollah equation. The political weight of Hezbollah, the Shiite group backed by Iran, further complicates Lebanon’s efforts to secure external funding. In 2018, the IMF pledged $ 11 billion to Lebanon on condition that the government institutes major economic and anti-corruption reforms. Washington, which, along with its Arab Gulf allies, regards the group as a terrorist organization, recently accused Hezbollah to hamper reform efforts, a view tacitly supported by other international donors.
This week’s uproar also comes as the country braces for a UN tribunal’s verdict on the 2005 murder of former Sunni Prime Minister of Lebanon Rafik al-Hariri, due on August 18. Hariri case, which has ignited sectarian tensions across Lebanon and the region, will likely involve Hezbollah officials. This risks further complicating efforts to secure outside aid and threatens to ignite sectarian discord among the already dejected Lebanese.
While negotiations with the IMF have stalled in recent months, a desperate Beirut facing Beijing for economic support, but he’s walking a fine line, fearing to anger Washington, a longtime ally, as US-China tensions rise.
The ball is largely in Beirut’s court. The government can begin to work on comprehensive reform in the hope of lifting its struggling population out of poverty. Alternatively, he can fall back on the excuse of international donors who do not show up and continue as usual. Which one will he choose?