Lebanon’s PM says preliminary talks with IMF moving forward

BEIRUT (AP) — Lebanon’s prime minister said Monday that preliminary talks with the International Monetary Fund are moving forward as the small nation works to pull itself out of one of the world’s worst economic crises in more than a century.

Najib Mikati said during an economic conference in Beirut that an amended financial recovery plan by asset management firm Lazard, the government’s financial adviser, will be ready by the end of November.

Mikati’s announcement came a month after Lebanon’s Finance Ministry said it has resumed “interactions” with the IMF on a bailout plan.

A new government was formed in September following more than a year of political bickering between rival groups. The Cabinet later that month named a delegation to resume bailout negotiations with the international agency after talks were suspended last year.

“Things are moving on the right track,” Mikati said adding that “we hope that we will have a letter of intent” soon that will be given to the IMF.

Deep disagreements festered within the Lebanese delegation during last year’s negotiations with the IMF, with the government on one side and the central bank and local lenders on the other. One of the main points of disagreement at the time was estimating losses.

“For the first time we have unified numbers” that were given to the IMF, Mikati said. He didn’t give a date on when he expects the talks with the IMF to resume.

In early March 2020, Lebanon did not pay back $1.2 billion in loans, marking its first-ever default. Since the crisis began in October 2019, Lebanon’s currency has lost more than 90% of its value and more than 70% of residents in Lebanon now live in poverty.

Days after the default in March last year, the government said Lebanon will stop paying all maturing Eurobonds in foreign currencies that are believed to be worth about $30 billion. Lebanon’s total debt is about $90 billion, of which about $60 billion is in Lebanese pounds, making it one of the highest in the world.

The World Bank said in June that Lebanon’s severe economic and financial crisis is likely to rank as one of the worst the world has seen in more than 150 years.

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