Speaking at the conclusion of the meeting, Hariri told reporters that the 2018 budget “includes numerous reforms and incentives for different sectors” needed to curb the country’s LBP 8 trillion deficit.
BEIRUT: Cabinet approved Monday the 2018 state budget in an expediated session ahead of the Paris IV aid conference, referring it to Parliament for ratification.
Speaking at the conclusion of the meeting, Prime Minister Saad Hariri told reporters that the 2018 budget “includes numerous reforms and incentives for different sectors” needed to curb the country’s LBP 8 trillion deficit.
As Lebanon continues to endure power shortages, Hariri vowed to restore the electricity sector by exploring the proposals put forth by President Michel Aoun, highlighting the need to put “political differences aside.”
Ratifying a state budget was seen an essential step as the country gears up to take part in the ‘Cedre’ conference in Paris next month, aiming to raise over 16 billion dollars for its 12-year investment program.
A hindrance to that objective is the country’s growing deficit, now estimated at 8 trillion Lebanese pounds, which further complicates official’s ability to raise the necessary funds.
Finance minister Hassan Ali Khalil maintained that the 2018 budget includes cuts that would decrease the deficit by LBP 220 billion less than in 2017, adding that no new taxes would be introduced.
Khalil also expressed hope in achieving “two percent growth within the next year,” praising the budget as a step in the right direction.
Lebanon’s economic struggles have hit an all-time high, becoming the world’s third most-indebted country as the government revenue fails to keep pace with spending.
Yet Hariri maintained that the upcoming donor conference in Paris would ease this brunt, casting aside the notion “that Lebanon is set to become the next Greece.”
“This budget and the reforms we hope to implement will veer the country away from a similar crisis,” he said.
While in Paris, Lebanese officials will seek to secure financing for investment programs in the transport, water, sanitation, electricity and telecommunications sectors, as well as the country’s industrial and tourism sectors.
Although the 16 billion dollars they hope to raise are essentially an extra layer of debt, Hariri maintained that the interest of 1.5 percent will be spread over the next 25 to 30 years, thus enabling Lebanon to “reinvigorate its economy by hiring more individuals and increase its GDP.”