The Finance and Budget Committee in a meeting on June 30. (Credit: Ali Fawaz, parliamentary photographer)
BEIRUT — The Finance and Budget Committee will resume discussions of the 2022 budget draft as early as next week after Finance Minister Youssef Khalil provided the committee with the missing information around the use of multiple exchange rates in forecasting revenues and expenses.
Here’s what we know:
• MP Ibrahim Kanaan, chair of the Finance and Budget Committee, said Monday during the committee meeting that the government has failed to explain the reasons behind its use of multiple exchange rates in the forecasting of revenues and expenses, despite multiple requests from the committee dating back to April.
• Kanaan added that the committee has already completed the review of the 2022 budget draft but it was still awaiting the Finance Ministry's input on why it had used the official rate of LL1,507.5 to the US dollar for expenses and the Sayrafa rate — last at LL25,600 to the US dollar — for revenues, leading to an unrealistic mismatch.
• In the budget draft’s preamble, Prime Minister-designate Najib Mikati specified that the government used the exchange rate of LL20,000 for the year 2021 and had taken into account the central bank’s Sayrafa rate, especially for customs taxes’ calculations.
• The 2022 budget was voted on by the government, headed by Mikati, last February and was sent to the Finance Committee a month later. The adoption of the budget by the Parliament will take place past the constitutional deadline, which was Jan. 2022.
• Parliament Speaker Nabih Berri has scheduled a Parliament session for next Tuesday. Among the several draft laws on the agenda, MPs are set to vote on amending the banking secrecy law, which is one of several key demands by the International Monetary Fund. The law was first adopted in 1956.
• Youssef Khalil also proposed a reassessment of the provisions concerning compulsory levies on imports, as well as another explaining the reasons for opening an additional credit of LL10 billion in the draft budget. This amount includes transportation costs for the military and civil servants, medical costs (hospitals, medicines and laboratories) and costs for the Lebanese University, according to the minister.
• The International Monetary Fund has demanded that Lebanon pass a draft budget as part of economic reforms to unlock a loan of three billion dollars over four years that is necessary to help resuscitate the crisis-hit country.