Lebanon must prioritize reforms to secure international assistance, US State Department top diplomat for the Middle East told Al Arabiya Wednesday.
Successive governments in the crisis-hit country have failed to make a series of reforms across multiple sectors needed to unlock international financial assistance and now face a collapsing currency and rising unemployment, and its economy has recently taken another hit dealt by coronavirus.
An accumulation of bad financial decisions, inaction, and entrenched corruption and cronyism, were the cause of Lebanon’s crisis, according to David Schenker, Assistant Secretary of Near Eastern Affairs.
“What is happening now is the product of more than a decade of difficult choices that weren’t made by the Lebanese government. Bad financial decisions and decisions that weren’t made. Likewise, corruption, patronage politics, a broad range of choices were made or weren’t made,” said Schenker.
Protests in Lebanon that began in October 2019 against government corruption and an ailing economy faded after the new year, in part due to coronavirus lockdowns, but now have made a resurgence, and banks across the country have been burned.
“We will see whether this government can demonstrate that level of commitment,” he said.
Schenker noted the government would need to make reforms to the electricity and telecommunications sectors and begin to collect customs and revenues, but at a time when many Lebanese are unemployed, these decisions will be difficult.
The new government, headed by Prime Minister Hassan Diab, came to power as a result of the October protests, and has succeeded in laying out a new economic roadmap, though the plan’s ability to fix the country’s problems is debated.
“It’s incumbent on them to move forward quickly with this [reform package] and to take steps that will put them in a position that international assistance by international financial institutions can step on and provide conditional support,” Schenker said.
But the Iran-backed Hezbollah has heavy influence in the new government, meaning some potential donors opposed to the group may be unlikely to assist the country financially. Hezbollah is a US-Treasury designated terrorist organization.
Speaking on the effect of US sanctions on Hezbollah, Schenker said, “There has been an impact, vis-à-vis, the maximum pressure campaign on Iran that has further denied revenues to Tehran which provides to terrorist organizations like Hezbollah.”
“The United States has provided something like $13-14 million to Lebanon for COVID-19, what has Hezbollah done? They were still flying in aircraft from Tehran after the schools closed in Lebanon, bringing in more COVID-19,” he continued.