Saadé Chami has spent most of his career with the IMF. (Credit: Photo from the Embassy of Canada Twitter account)
BEIRUT — Deputy Prime Minister Saade Chami announced in a press briefing Thursday that the government’s technical discussions with the Internal Monetary Fund are “almost complete” and that negotiations around the economic and monetary policies have started.
Here's what we know:
• After meeting with President Michel Aoun, Chami said the government’s objective is “still to reach a preliminary deal before the end of 2021 … and to agree on a plan in January of next year as required.”
• Chami also said that the negotiations with the IMF revolve around several areas, including the budget, which he said the Finance Minister is preparing as quickly as possible; the exchange rate; monetary policy; and banking sector issues, of which, he said, “we are preparing a plan to solve which will be announced when it is done.”
• Chami also said the government is working on finding solutions to poverty and electricity shortages which “the energy minister is working on improving.”
• When asked about the upcoming parliamentary elections’ effect on the negotiations, Chami insisted that elections have no bearing on the progress of talks with the IMF.
• Regarding a unified lira-to-dollar exchange rate, Chami said “this demand is the demand of everyone and I think it will be an IMF demand because things can’t continue as it is with multiple dollar rates.” Lebanon’s residents must currently contend with an array of exchange rates for country’s national currency: these include the official peg of LL1,500 to the US dollar, the so-called “lollar” bank dollar deposit withdrawal rate of LL3,900, the Sayrafa rate, which changes daily but is below the parallel market rate, and the parallel market rate which is now above LL24,000.
• Chami also insisted that the inability of the government to meet for over a month has had no impact so far on the ministers’ work but admitted that eventually any plan to continue the IMF negotiations must be presented to the cabinet. The government has not met since an Oct. 12 session during which Amal and Hezbollah ministers demanded the removal of port blast investigation head Judge Tarek Bitar, causing the session to be adjourned. Disagreement over Bitar’s leadership of the probe persists, and Premier Najib Mikati has said cabinet will not convene until a solution to the issue is found. Last week, Mikati said that he would call cabinet to meet soon, but did not say when, and there is no indication of a resolution to the Bitar issue.
• Last year, negotiations with the IMF reached a deadlock after disagreements between the Association of Banks in Lebanon and the central bank on one hand and the government at the time on the other over the central bank’s losses. Commenting on the previous round’s lack of progress, Chami noted that the financial figures submitted “ will be agreed on... by all parties.” The Lebanese delegation, which is made up of three ministers and the BDL head, “has met several times and will continue to meet in order to agree on all aspects of the plan,” he said.