Lebanon's caretaker Prime Minister Najib Mikati during a meeting at the Grand Serail, Feb. 17, 2023. (Credit: Dalati and Nohra)
This article was updated at 9:00 p.m. Beirut time to include Mohieldin's meetings with Berri and Khalil.
BEIRUT — Caretaker Prime Minister Najib Mikati met with the Executive Director of the International Monetary Fund, Mahmoud Mohieldin, the state-run National News Agency (NNA) reported Friday. Mohieldin assured after the meeting that "the IMF is not planning on canceling the agreement signed with Lebanon."
Mohieldin emphasized that "the meeting with Mikati comes within the framework of a series of meetings held with several Lebanese officials to review the relationship between Lebanon and the IMF, and the ongoing preparations for the visit that a delegation from Lebanon, led by the Deputy Prime Minister, will undertake to Washington in mid-this month to participate in the IMF meetings."
On April 7, 2022, the IMF reached a staff-level agreement with Lebanon on comprehensive economic policies that could grant the country access to $3 billion — should officials implement all actions and reforms set by the IMF in a timely manner.
Most of the legal changes that the IMF is requesting prior to a final agreement have not been implemented, or, as in the case of the banking secrecy law for example, have been amended in ways that do not meet the IMF’s approval.
As the country’s devastating economic crisis stretches into its fourth year, Lebanon’s political parties remain deadlocked, leaving the state with no president and no fully empowered government.
"Ruling elites have effectively sabotaged the IMF negotiating process,” a report from Lebanese think tank The Policy Initiative and US-based think tank Century International in 2023 said. It argued that government inaction demonstrates a preference for their own vested interests — which would be threatened by the reform measures required by the IMF in exchange for financing — over the potential financial infusion offered by the IMF.
Mahmoud Mohieldin also met with outgoing Finance Minister Youssef Khalil where he told Khalil that economic recovery in Lebanon is impossible so long as the government continues to be unable to adopt legislation relating to the restructuring of banks and a resolution of the deposit problem "in a sustainable manner."
He warned that a lack of consensus on this subject will have big consequences for depositors and for the health of the economy in general. Still, he assured that the IMF was ready to support the Ministry of Finance and "to provide all necessary technical assistance to support Lebanon in this critical stage."
Mohieldin met with Speaker of Parliament Nabih Berri, again discussing, as per Berri's statements following the meeting, the importance of "fully preserving depositors' rights and restoring confidence in the Lebanese banking sector and the country."