Econostrum | Economic News in the Mediterranean

France and the UN launch a new donor conference for Lebanon

Written by Eric Apim on Wednesday, December 2nd 2020 à 16:30 | Read 325 times

In 2018, Saad Hariri had persuaded international donors to help Lebanon (photo: F. de la Mure (MEAE)
In 2018, Saad Hariri had persuaded international donors to help Lebanon (photo: F. de la Mure (MEAE)
LEBANON. While the country has been trapped for months in a political stalemate, a serious economic crisis and social movements that have been running for more than a year, Emmanuel Macron and Antonio Guterres will co-chair a new international donors' conference for Lebanon on Wednesday 2 December 2020 in virtual mode.

The French President and the UN Secretary General intend to raise funds to support the Lebanese population. According to the two co-presidents, the aim of this conference "is to take stock of the aid provided by the international community and the way it has been distributed since the conference of 9 August, to take stock of the new needs and to work to meet them in the context of the crisis in Lebanon".

The meeting of Heads of State, which will start at 18:30 French time and will be conducted from the Elysée Palace in Paris, will be attended by international organisations, NGOs, representatives of civil society and multilateral donors.

The previous donors' conference on 9 August 2020, convened after the explosion in the Port of Beirut, raised a pledge of €257 million for emergency aid. It will form the basis for discussions.


Without a government, Lebanon cannot carry out the necessary structural reforms

Lebanon has been without a government for three months and the resignation of Hassan Diab, its Prime Minister, who failed to form a unity government. Returning to the political scene on 22 October 2020, former Prime Minister Saad Hariri, who had had to leave his post because of the numerous demonstrations demanding his departure and that of the entire political class deemed incompetent and corrupt, has still not managed to unite a coalition around him either.

The country is therefore unable to carry out the structural reforms, which are not only necessary for its economic recovery, but are also a prerequisite for financial support from international organisations. In April 2018, the CEDRE Conference (Economic Conference for Development through Reforms and with Business) in Paris resulted in $11.6bn (€10.4bn at the time) in pledges of grants and loans in return for a commitment from Beirut to carry out reforms.

In a report published on Tuesday 1 December 2020, the World Bank points out, without any ambiguity, those responsible for the situation: "one year after the serious economic crisis in Lebanon, the deliberate absence of effective political action on the part of the authorities has subjected the economy to an arduous and prolonged depression". The institution estimates that the country's Gross Domestic Product (GDP) should contract by 19.2% in 2020 (-6.7% in 2019) and that its debt will represent 194% of its GDP. Lebanon has been in suspension of payments since 7 March 2020.

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