ECONOMY

World Bank ready to support Lebanon, urges quick formation of new cabinet

Lebanese protesters wave the national flag in downtown Beirut on October 19, 2019. (AFP)

The World Bank said on Wednesday it stood ready to back a new Lebanese government and warned that the country had no time to waste to fix economic troubles that were becoming worse by the day.

The bank called for the rapid formation of a new cabinet and said it expected a recession in 2019 to be even more significant than an earlier projection of a 0.2% contraction in the economy.

A wave of massive protests against the ruling elite across Lebanon pushed Prime Minister Saad Hariri to resign last week, toppling his coalition cabinet. There has been no sign of progress towards agreeing a new government.

The political turmoil comes as Lebanon grapples with the worst economic and financial strains since the 1975-90 civil war.

RELATED: Moody’s downgrades protest-hit Lebanon

The World Bank is among foreign donors who pledged billions of dollars in badly needed aid last year, as long as Lebanon’s government enacts reforms it has long neglected. But with foreign allies not fully convinced, the money has yet to flow into the economy.

“With every passing day, the situation is becoming more acute and this would make recovery extremely challenging,” World Bank regional director Saroj Kumar Jha said in a statement after meeting with Lebanese President Michel Aoun on Wednesday.

“We stand ready to extend all possible support to the new government that commits itself to good governance and creating opportunities for all Lebanese, especially the youth and women,” the World Bank statement said.

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Last Update: Wednesday, 6 November 2019 KSA 17:50 - GMT 14:50
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