The European Bank for Reconstruction and Development (EBRD) warned that Lebanon needed to implement “painful” reforms, especially in its energy sector and to tackle its large debt burden, or face an economic crisis.
“The reforms will be painful, but the alternative is more painful,” EBRD first vice president Jurgen Rigterink said after he met Lebanese Finance Minister Ali Hassan Khalil.
“The economic indicators now point to an impending crisis,” said Rigterink, according to a statement by the Finance ministry.
Khalil on Monday met with Rigterink, who headed a delegation from EBRD that included Vice President for Policy and Partnerships, Pierre Heilbronn, the regional Head of Eastern Mediterranean, Heike Harmgart, and Head of Lebanon's office, Gretchen Biery.
“There will be a lot of investments,” Rigterink said in response to a question about the purpose of his visit to Lebanon, and the possibility of making new investments other than those launched in 2017.
“In 2018, investments amounted to €244 million, and we want to continue and accelerate the process if possible. Nonetheless, the most important issue that I have broached with the minister is the current economic indicator of an impending crisis,” he stated, adding: “We at the EBRD feel that there is a need for important, bold reforms, especially in terms of correcting the general fiscal situation and energy.”
He continued: “We believe that thanks to the current government, Lebanon is ready to take strict reform measures.”
The EBRD VP noted that both Prime Minister Saad Hariri and the finance minister have confirmed the seriousness of the situation, “and we hope that in two months, we will witness the new state budget under implementation.”
