Egypt's Democratic Generation Party Evaluates 84 Candidates Ahead of Parliamentary Vote    English version of Egypt's tax facilitation initiative laws – full text    UK to seal 1st post-tariff war trade deal with US    Egypt, Japan discuss ICT cooperation, AI strategy alignment    Egypt's FM urges stronger African role in global governance    Egypt, Bahrain discuss enhanced pharmaceutical cooperation    Egypt's EHA partners with Danone Egypt on clinical nutrition    Qatar holds key interest rates steady    Tax Authority prepares comprehensive guide on exported services: Abdel Aal    Egypt, Qatar reaffirm joint mediation efforts amid escalating Gaza crisis    Egypt-Greece trade exchange falls to $1.6bn in 2024: CAPMAS    Fotouh Al-Kuwait to build EGP 86m packaging factory in Sokhna Industrial Zone    Egypt, Greece sign strategic partnership in Athens, hold 1st cooperation council    Minister of Health discusses strengthening healthcare partnership with AFD    India strikes Pakistan, Islamabad claims 5 Indian jets downed amid escalation    Egypt welcomes Oman-brokered US-Yemen ceasefire agreement    Egypt inks deal with Merck to advance healthcare training    Health Minister orders expansion of residency training programmes to strengthen medical workforce    Al Ismaelia, Coventry University Cairo partner on urban development education    Egyptian FM addresses Arab Women Organization Conference opening    On Sport to broadcast Pan Arab Golf Championship for Juniors and Ladies in Egypt    Golf Festival in Cairo to mark Arab Golf Federation's 50th anniversary    Germany among EU's priciest labour markets – official data    Cabinet approves establishment of national medical tourism council to boost healthcare sector    "5,000 Years of Civilizational Dialogue" theme for Korea-Egypt 30th anniversary event    Sudan conflict, bilateral ties dominate talks between Al-Sisi, Al-Burhan in Cairo    Cairo's Madinaty and Katameya Dunes Golf Courses set to host 2025 Pan Arab Golf Championship from May 7-10    Between Women Filmmakers' Caravan opens 5th round of Film Consultancy Programme for Arab filmmakers    Egypt's PM follows up on Julius Nyerere dam project in Tanzania    Ancient military commander's tomb unearthed in Ismailia    Egypt's FM inspects Julius Nyerere Dam project in Tanzania    Egypt's FM praises ties with Tanzania    Egypt to host global celebration for Grand Egyptian Museum opening on July 3    Ancient Egyptian royal tomb unearthed in Sohag    Paris Olympic gold '24 medals hit record value    A minute of silence for Egyptian sports    Russia says it's in sync with US, China, Pakistan on Taliban    It's a bit frustrating to draw at home: Real Madrid keeper after Villarreal game    Shoukry reviews with Guterres Egypt's efforts to achieve SDGs, promote human rights    Sudan says countries must cooperate on vaccines    Johnson & Johnson: Second shot boosts antibodies and protection against COVID-19    Egypt to tax bloggers, YouTubers    Egypt's FM asserts importance of stability in Libya, holding elections as scheduled    We mustn't lose touch: Muller after Bayern win in Bundesliga    Egypt records 36 new deaths from Covid-19, highest since mid June    Egypt sells $3 bln US-dollar dominated eurobonds    Gamal Hanafy's ceramic exhibition at Gezira Arts Centre is a must go    Italian Institute Director Davide Scalmani presents activities of the Cairo Institute for ITALIANA.IT platform    







Thank you for reporting!
This image will be automatically disabled when it gets reported by several people.



IMF urges Lebanon to make ‘immediate and substantial' fiscal adjustment
Published in Amwal Al Ghad on 23 - 06 - 2018

Lebanon requires "an immediate and substantial" fiscal adjustment to improve the sustainability of public debt that stood at more than 150 percent of gross domestic product (GDP) at the end of 2017, the IMF executive board said.
An IMF statement released overnight said IMF executive directors agreed with the thrust of a staff appraisal which in February urged Lebanon to immediately anchor its fiscal policy in a consolidation plan that stabilizes debt as a share of GDP and then puts it on a clear downward path.
Lebanon's debt to GDP ratio is the third largest in the world.
"Directors stressed that an immediate and substantial fiscal adjustment is essential to improve debt sustainability, which will require strong and sustained political commitment," the IMF executive board statement said.
It reiterated estimates of low economic growth of 1-1.5 percent in 2017 and 2018. "The traditional drivers of growth in Lebanon are subdued with real estate and construction weak and a strong rebound is unlikely soon," it said.
"Going forward, under current policies growth is projected to gradually increase towards 3 percent over the medium term."
Lebanon's economy has been hit by the war in neighboring Syria. Annual growth rates have fallen to between 1 and 2 percent, from between 8 and 10 percent in the four years before the Syrian war. Two former pillars of the economy, Gulf Arab tourism and high-end real estate, have suffered.
Caretaker Prime Minister Saad al-Hariri has been designated to form a new government following parliamentary elections last month, Lebanon's first since 2009, and has stressed the need for the state to see through long-delayed economic reforms.
Donor states and institutions are looking to Lebanon to form a government quickly and implement the reforms in order to release billions of dollars worth of financing pledged at a conference in Paris in April. In Paris, Hariri promised to reduce the budget deficit as a percentage of GDP by five percent over five years.
The directors "noted that a well-defined fiscal strategy, including a combination of revenue and spending measures, amounting to about 5 percentage points of GDP, is ambitious but necessary" to stabilize public debt and put it on a declining path over the medium term.
They recommended increasing VAT rates, restraining public wages, and gradually eliminating electricity subsidies. Last year the government spent $1.3 billion subsiding the state power provider – 13 percent of primary expenditures.
On Friday Moody's rating agency, whose credit rating for Lebanon is B3 stable, said Lebanon had the highest interest-to-revenue ratio of all countries it rates, at 42.9 percent.
"Combined with an average term to maturity of about five years, this underscores the sovereign's very high sensitivity to further interest rate rises," said Moody's analyst Elisa Parisi-Capone in a statement.
Moody's was more positive about Lebanon's growth outlook than the IMF and said the economy grew by around 1.9 percent in 2017 and it foresees 2.5 percent growth in 2018 and 3 percent in 2019.
This outlook is based on expectations of greater economic policy coordination, the winding down of the open conflict in Syria and that the Paris donor money will begin to flow.


Clic here to read the story from its source.