A team of experts from the International Monetary Fund (IMF) arrived in Beirut last week at the new Lebanese Cabinet’s request to offer technical support and advising on the manner through which to resolve Lebanon’s escalating economic crisis.
But not everyone seems to be pleased with this form of international assistance.
Hezbollah representatives spoke out on Tuesday, February 25th, against the IMF managing Lebanon’s ongoing financial crisis, but said it does not oppose the country seeking the IMF’s “advice.”
They are, however, against the IMF interfering to the degree where they will “impose” anything on Lebanon.
Hezbollah Deputy Leader Sheikh Naim Quassem said: “We will not accept submitting to imperialist tools. Meaning, we do not accept submitting to the International Monetary Fund to manage the crisis. Yes, there is nothing to prevent consultations with the IMF, and this is what the Lebanese government is doing.”
Hezbollah currently stands as one of the country’s main parties which gave its support to Lebanon’s new Cabinet. The Cabinet, as the Deputy Leader clarified, requested technical but not financial assistance from the IMF.
Currently confronted with a massive public debt burden and an acute liquidity crisis, the Lebanese state has resorted to the appointment of international investment and law firms as financial and legal advisers on a widely expected “restructuring of its sovereign debt.”
Lebanon is still tasked with deciding the optimum manner through which to handle forthcoming maturities of sovereign debt, including a $1.2bn Eurobond due on March 9, 2020.
Lebanon’s Parliament Speaker Nabih Berri, a Hezbollah ally, seconded the Hezbollah Deputy Leader’s statement, insisting Lebanon could not “surrender itself to the IMF” due to the fact that the nation could not handle the IMF’s conditions or impositions.
The Cabinet has given its approval for American asset management company Lazard to act as Lebanon’s financial adviser as well as to the law firm Cleary Gottlieb Steen & Hamilton LLP to act as its legal adviser on the debt restructuring.
In the past, Lazard has advised some of the world’s largest sovereign debt restructurings including those which took place in Argentina, Greece, and Ukraine.
Lazard Freres, a French subsidiary of Lazard, was one of the firms that advised Argentina in overhauling its debt crisis after it had defaulted on some $100bn loans during its economic crisis in 2002.
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