Lebanon eyes $4B loan deal with IMF

BEIRUT, Lebanon

Lebanon is set to resume negotiations with the International Monetary Fund next week on an economic reform program alongside a $4 billion loan, according to the Lebanese economy minister.

In an interview with Anadolu Agency, Amin Salam said that official negotiations with the IMF will start on Monday.

The Arab nation is seeking to reach an aid program with the global financial institution in a bid to pull itself out of the severe economic and financial crisis that has afflicted it since late 2019.

"The negotiations will start upon the completion of preparatory discussions on the figures requested by the IMF regarding the extent of losses in the financial and banking sectors,” Salam said.

Salam, also a member of the government's negotiating body headed by Deputy Prime Minister Saadeh al-Shami, estimated the losses at around $69 billion.

Talks between Lebanon and the IMF on an aid program began in May 2020. However, they were frozen that August, before resuming last October, after the formation of a new government headed by Najib Mikati.

Salam said the upcoming talks will take place virtually due to the ongoing coronavirus pandemic.

Negotiations will focus on the recovery plan, growth, and economic reform, as well as the 2022 budget, he said.

The new budget includes "many numbers and details that the recovery plan needs,” Salam added.

He said the government has finalized its economic recovery plan, whose implementation will begin next March once the budget is finalized.

On Wednesday, the International Support Group for Lebanon, made up of the UN and a number of countries, said Lebanon’s approval of the budget will "pave the way for reaching a deal with the IMF."

Salam expects the IMF to provide Lebanon with a loan of $3-4 billion once the borrowing program is finalized, while also hinting at the possibility of expanding the program in the near future.

*Writing by Ibrahim Mukhtar