Beirut Report # 2, January 31th, 2020

by «Yves»

This past week, in spite of demonstrations, the Sérail which had been actually surrounded by the demonstrators has gathered 73 of its members.

With a slight majority of 49 members mainly from CPL (Courant Patriotique Libre pro Aoun), from Hezbollah and Amal, the budget had finally been voted while thirteen voted against and 58 were absent. Some have argued that since the government had not been approved by parliament yet, the decision might be unconstitutional.

The deficit of this budget which had actually been prepared by the previous Hariri government last November is far from what had been proclaimed – 0,63% – and will rather be in the realm of 6 to 7%. Public expenses for 2020 are evaluated at 18,223 billion livres libanaises (LL) (approx. 12 Billion $) and with a state income of 13,395 LL billion (8,8 Billion $), it will mean a deficit of 4,837 billion LL to which you have to add 1,300 billion lent by the government to the Electricité du Liban. Finally, among the significant measures taken by the government was an exceptional tax of 2% on the sales turnover of the banks.

In his latest statement Thursday, the governor of the Banque du Liban, Riad Salamé, has renewed his current opposition to a devaluation of the LL.But it remains to be seen how this will be done.

The other focus of the press this week was the recent US plan for the Middle East. It was overall rejected and President Aoun is reported to have called the President of the Palestinian authority to assure him of the support of Lebanon.