Muhammad Wahba wrote in “Al-Akhbar”: The Ministers of Finance and Economy and the Governor of the Bank of Lebanon will head to the French capital to hold a meeting with a delegation from the International Monetary Fund next Tuesday, in order to discuss a number of financial and banking issues related to the planned agreement between Lebanon and the Fund. At the forefront of these issues is the draft medium-term financial framework, which is considered an essential step in reaching an agreement at the staff level with the Fund, and paves the way for negotiations with foreign creditors.
However, the timing of this visit sparked widespread criticism, especially as it comes in light of the Israeli aggression against Lebanon, which requires an intense government presence and greater activity in dealing with the displacement and shelter crisis, especially by the two ministers and the governor. In addition, resuming the financial discussion related to the agreement with the International Monetary Fund is considered premature at the present time, as any financial framework depends on economic and financial variables that are difficult to estimate before the end of the aggression.
The medium-term financial framework is essentially a plan based on semi-fixed data that allows for accurate financial estimates. However, in light of the current conditions in Lebanon and the region, these estimates may be subject to large margins of error, which may directly affect the numbers contained in the plan. Will the government be able to estimate its expenditures on society if the end of the war is not yet clear? Will you be able to estimate the amount of revenue under these circumstances? What will the growth be? What is the expected level of inflation? What will happen to the government’s current liquidity and spending priorities? There are many challenges and variables that make the estimation task very difficult. Therefore, the financial framework that ministers will discuss will be weak and unreliable. This raises clear questions about the feasibility of discussing this issue at this time with the International Monetary Fund. Was it not possible to discuss the broad outlines of this framework remotely using available applications, or do ministers only prefer direct discussions?
In fact, the ministers justify their desire to attend the meeting by saying: “As long as the Parisian meeting does not affect their work in Lebanon on issues of displacement, monitoring prices, and others, there is no need to panic.” This is a phrase that “we have heard a lot in recent years, and it was a major reason for panic.” In essence, “no actual discussion of the economy has been recorded in the history of this government within an organized paper with a clear methodology.” Even to some sessions devoted to discussing financial situations, “ministers came to them empty-handed because the General Secretariat of the Council of Ministers did not receive any files, suggestions, or scenarios for study and discussion from the Ministry of Finance.” As for going to the IMF empty-handed, “it cannot be reassuring, unless the intention is to obtain instructions.” “By the way, these instructions can be obtained via email, text message, or WhatsApp.”
