BEIRUT — The Free Patriotic Movement on Saturday criticized the draft 2022 budget released Friday by the Finance Ministry ahead of a cabinet session scheduled for Monday to discuss the issue.
Here’s what we know:
• In a statement following the weekly meeting of its political bureau, the FPM said the draft budget did not “reflect a vision of economic recovery and is only a quantified budget which will result in a recession.”
• The draft budget “does not encourage growth and increases the burdens on the productive sectors,” the FPM also said.
• The party also criticized the budget for “granting the minister of finance exceptional powers to modify the law governing income tax and certain terms and conditions concerning new deposits in dollars as well as the exchange rate.”
• The FPM dubbed these “exceptional powers” as a “dangerous development.” Finance Minister Youssef Khalil is perceived as close to Speaker Nabih Berri, a political rival of the FPM.
• The long-awaited draft of the 2022 budget, nearly 1,300 pages long, forecasts a deficit of LL10.26 trillion – 20.77 percent of expenditures – excluding a treasury advance of LL5.25 trillion to Electricité du Liban.
• The exchange rate used for operating expenses is estimated to be between LL15,000 to LL20,000 to the US dollar, lower than the current parallel market rate of LL23,000, itself a drop from higher rates after Banque du Liban started injecting more dollars into the market through its Sayrafa exchange program.