Lebanon’s new Prime Minister Najib Mikati says he has no “magic wand” to fix the country’s economic and financial crises, following more than a year of political deadlock over the formation of a government.
Mikati made the remark in a statement on Monday, saying he has “no magic wand to rescue the country from one of its worst-ever economic crises,” and that it takes determination and a plan to fulfill achieve the hopes of the Lebanese people.
“It is true that we don’t have a magic wand. The situation is very difficult,” the statement said, adding that there was no time to lose and no easy path to tackle Lebanon’s economic meltdown.
Mikati, however, pledged to work hard for Lebanon to resolve shortages of fuel and medicine, the supplies of which have dried up as the country’s hard currency reserves have run out.
Mikati, who took the office last week, has promised to revive talks with the International Monetary Fund (IMF) as part of efforts to unlock financial aid.
On Friday, Lebanese leaders agreed on the formation of a new government after a 13-month deadlock that left the country grappling with a severe economic and financial crisis.
The World Bank has called Lebanon’s crisis one of the worst depressions of modern history, ranking it among the world’s three worst since the mid-1800s in terms of its effect on living standards. The country’s currency has lost more than 90% of its value since fall 2019, and more than half of the population has been rendered jobless as businesses have shut down.
The crisis has forced nearly three-quarters of the country’s six million inhabitants into poverty.
Lebanon’s Aoun stresses IMF talks in first cabinet meeting
Mikati’s comments came during the first meeting of Lebanon’s newly-formed government at the Presidential Palace to discuss ways of rescuing the country from the crisis.
President Michel Aoun, for his part, told the new cabinet that he hoped for the pursuit of negotiations with the IMF, saying talks with the international institution on financial assistance are key to rescuing Lebanon.
“This fourth government in my presidential term was formed after 13 months of the caretaker government,” Aoun said, adding that “during this period, the situation worsened economically, financially, monetary and socially… and the living conditions citizens deteriorated to unprecedented levels.”
The Lebanese president stressed that “The government must work as one homogeneous, cooperative team to implement a rescue program, focusing effort to achieve the supreme national interest and the interests of citizens.”
Earlier in the day, Lebanon’s finance ministry announced that it would receive a total of $1.135 billion in special drawing rights from the International Monetary Fund, and the sum would be deposited on September 16.
Lebanon has been mired since late 2019 in a deep economic and financial crisis, exacerbated by a political deadlock. The economic and financial crisis is the gravest threat to the country’s stability since the 15-year civil war ended in 1990.
The crisis is mostly linked to the sanctions that the United States and its allies have imposed on Lebanon as well as foreign intervention in the nation’s domestic affairs.