Lebanon cabinet agreed on some fast-tracks economic reforms as protests rage on across the country

AFP , Monday 21 Oct 2019

Prime Minister Saad Hariri's cabinet approves emergency economic reforms in response to countrywide protests due to economic woes caused by corruption, lack of job opportunities and poor public services

An areal view taken on October 21, 2019, shows Lebanese protesters rallying in downtown Beirut, on t
An areal view taken on October 21, 2019, shows Lebanese protesters rallying in downtown Beirut, on the fifth day of demonstrations against tax increases and official corruption. (AFP)

Lebanon's teetering government approved an economic rescue plan Monday but the last-ditch move was met with deep distrust from a swelling protest movement seeking the removal of the entire political class.

A proposed tax on mobile messaging applications last week sparked a spontaneous, cross-sectarian mobilisation -- at first dubbed a "WhatsApp revolution" -- that has brought Lebanon to a standstill and united the people against its hereditary, ruling elite.

Prime Minister Saad Hariri seemed aware that the measures he announced -- which include a deal on the 2020 budget and significant reforms that seemed unlikely only a week ago -- would not quench the people's thirst for change.

"These decisions are not designed as a trade-off. They are not to ask you to stop expressing your anger. That is your decision to make," Hariri, himself an ex-prime minister's son, said in a televised press conference.

Euphoric crowds partied deep into the night Sunday, leaving political and sectarian paraphernalia at home to gather under the cedar-stamped national flag, dance to impromptu concerts and chant often hilarious anti-establishment slogans.

They were back in front of the houses of government and on the main Martyrs' Square on Monday to listen to Hariri's announcement, which was broadcast on loudspeakers.

The crowd erupted into shouts of "revolution, revolution" when Hariri finished his address.

"We want the fall of the regime," they went on.

"This is all just smoke and mirrors... How do we know these reforms will be implemented?" asked Chantal, a 40-year-old who joined the protest with her little daughter and a Lebanese flag painted on her cheek.

'Day Of Destiny' 

Prime Minister Saad Hariri announced the measures in a televised press conference and the details of the package were published later in a statement and here are the key points:

Public Finances

- Reduction of state deficit to 0.63 percent of GDP in 2020, down from 7.59 percent in the 2019 budget

- The salaries of active and former presidents, ministers and lawmakers are slashed by half

- Ministry of information and other government bodies abolished to cut costs

- Banking sector to contribute 5.1 trillion Lebanese pounds ($3.4 billion) to deficit reduction

- State electricity company's deficit to be slashed by one trillion Lebanese pounds ($663 million)

- Launch of a plan to partially or fully privatise several sectors and public firms, including mobile phone operators, the Port of Beirut and national carrier Middle East Airlines

Social Measures

- New pension and welfare systems by the end of the year

- A 20-billion-pound ($13.5 million) boost to a fund for Lebanon's poorest and acceleration of a World Bank loan to support them

- 160-million cash injection to support housing loans

- Amnesty law to be adopted by end of 2019

Anti-Corruption Measures

- Establishment of a national anti-corruption body

- Halt to state financing of infrastructure projects, which are to be developed by alternative funding including direct foreign investment

- Crackdown on smuggling with scanners and other measures

- Bill on the recovery of embezzled public funds


- Permits to be granted within four months for the construction of power plants to tackle chronic blackouts

- Launch of the first phase of an infrastructure investment plan agreed in April 2018

- Major roadworks to facilitate access to Beirut

- Creation of regulatory authorities for the energy, telecommunications and civil aviation sectors and the stock exchange

He also said his government would in three weeks approve the first batch of infrastructure projects funded by an $11-billion aid package pledged to Lebanon by international donors last year.

The premier said the economic rescue plan would "satisfy" international donors who took part in the CEDRE conference in Paris in 2018.

Lebanese economist Ghazi Wazni said it would also likely be well received by rating agencies and the International Monetary Fund.

Lebanon's embattled political leaders have warned that the government's resignation at this time would only deepen the crisis gripping the small Mediterranean country.

Hariri also said he supported the idea of early elections, a key demand among the hundreds of thousands of protesters who have taken to Lebanon's streets since last Thursday.

President Michel Aoun, who had been conspicuously silent since the start of the demonstrations, suggested at the start of the cabinet meeting that banking secrecy should be lifted for high-ranking officials.

Lebanon has strict rules over bank account privacy that critics say makes the country susceptible to money laundering.

Dozens of demonstrators on Monday night gathered in front of the central bank in Beirut, accusing its chief Riad Salameh of worsening the country's debt through faulty monetary policies.

Aoun's son-in-law and ally, Foreign Minister Gebran Bassil, has also been a particular figure of anger among protesters.

To many demonstrators, the reforms Hariri announced smacked of a desperate attempt by a corrupt elite to cling to their jobs, and there was little sign Monday that the mobilisation was weakening.

"It is a day of destiny for us. All our hard work and efforts in previous days and years were to get us to this moment," said Roni al-Asaad, a 32-year-old activist in central Beirut.

"If they could have implemented these reforms before, why haven't they? And why should we believe them today?"

The protests have morphed into a mass non-partisan push for a total overhaul of a sectarian power system still run mostly by civil war-era warlords, three decades after the end of Lebanon's conflict.


Given the size of the gatherings, the five-day-old mobilisation has been remarkably incident free, with armies of volunteers forming to clean up the streets, provide water to protesters and organise first aid tents.

Lebanon's debt-burdened economy has been sliding towards collapse in recent months, adding to the economic woes of a population exasperated by rampant corruption, a lack of job opportunities and poor public services.

Usually prone to blame anti-government mobilisation on another party or a foreign conspiracy, Lebanon's top political figures have appeared to acknowledge that none of them have been spared in the show of public anger.

"What happened in the street is a volcano that can't be contained with timely solutions," said Imad Salamey, a political science professor at the Lebanese American University.

"It is difficult for the demonstrators to regain trust in the state in 72 hours and with solutions only presented on paper," he said.

Schools, banks, universities and many private businesses closed their doors Monday, both for security reasons and in an apparent bid to encourage people to join the demonstrations.

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