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Lebanon economy

Lebanon to complete cenbank FX audit, an IMF condition, by June: Deputy PM

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Lebanon will complete the first in a set of conditions for an IMF bailout, an audit of the central bank’s forex position, by June, the country’s deputy prime minister said during a meeting with the creditors of the Lebanese state on Wednesday.

Lebanon in April reached a draft agreement with the IMF for a four-year $3 billion bailout, the final approval of which was conditional on the implementation of eight main requirements.

An IMF program is seen as crucial for Lebanon to begin emerging from a devastating financial crisis that has left most people poor, due to the deep reforms it would entail and the international funding it could unlock.

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Saade Chami said Lebanon required between $8 billion and $10 billion over 10 years on top of the IMF funds.

He said he could not give a specific date for the completion of all conditions, as many require parliamentary approval.

Those include capital controls, amendments to banking secrecy regulations and a framework for banking restructuring.

Lebanon holds its first polls in four years on May 15.

“If parliament approves the draft laws, the prior actions, then we can move very quickly,” he said, suggesting parliament could do so by mid-June.

The World Bank has described Lebanon’s crisis, the result of decades of corruption and mismanagement, as one of the worst in modern times.

Chami said that governance reform, though difficult, would be at the center of the government’s recovery plan, which aims to reduce government debt from more than 300 percent of GDP in 2021 to 100 percent of GDP by 2026.

“To be frank, this entrenched problem cannot be solved overnight, it will take some time in order to change the culture and make a difference, but I think this is something the government intends to do,” he said.

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