Lebanese bankers have expressed fears over the government’s delay in approving the 2019 state budget, saying the postponement could be aimed at adopting it without introducing new reforms.
“There are substantial risks on the economy and the currency in case the government fails to pass the budget by the end of this month,” the sources told Asharq Al-Awsat.
The “marathon” discussions on finalizing the budget continued on Friday, as Foreign Minister Gebran Bassil and Finance Minister Ali Hassan Khalil remain at odds over whether more is needed to bring down the deficit.
“The budget is not up to the level of needed reforms to reach growth,” said Deputy Prime Minister Ghassan Hasbani.
The government holds a meeting on Friday, supposedly the last, to discuss the state budget before referring it to Parliament for approval.
Hassan Khalil declared the budget complete at the start of the week while Bassil responded by saying the budget would be over when it is over.
Speaking to Reuters by phone on Thursday, Hasbani said he had “deep concerns” about delays to a final agreement, and that additional ideas under discussion amounted to “small, incremental points”.
“Catastrophe has been avoided through this stabilization budget but much more needs to be done on the structural reform side in order to build growth going forward to avoid any future problems,” Hasbani said.
A cabinet minister denied that the draft budget only targets the poor by imposing taxes on them.
“We introduced taxes on banks. There will be a 10 percent tax on the interest rate, a rise from 7 percent,” the minister, who refused to be identified, told Asharq Al-Awsat.
