Lebanon Decided Not to Pay Its Due Eurobonds

As the deadline of March 9th for the $1.2 billion in Eurobonds inches closer, the decision on whether or not to pay the debt has become increasingly urgent. Many have feared that won’t pay Eurobonds and those fears have officially been confirmed.

Despite the government’s previous announcement that they will accept the IMF’s bailout plan, officials reached a unanimous decision that won’t pay its due Eurobonds. Government officials told news outlets ahead of time about the decision and it was later confirmed in Prime Minister ’s speech.

Prime Minister announces Lebanon won't pay Eurobonds
Via France24

In his speech, announces: “Our international reserves have reached critically low levels, forcing the Lebanese Republic to withhold all the payments on the Eurobonds that are due on March 9th.”

As has been pointed out before, this will be the first time ever in ’s history that the country has chosen to default on its debts. The cabinet, which is largely controlled by and its allies, is strongly against the repaying of these debts.

Image result for IMF Lebanon
Via Reuters

If won’t pay Eurobonds, what does this mean for the IMF’s bailout plan? If the government chooses to default on its debt, does that constitute a rejection of the terms suggested by the plan?

Hezbollah has previously made its position on the IMF and the debt very clear. As MP Hassan Fadlallah had previously stated, “The position is not towards the Fund as an international financial institution but on the terms offered to because they will lead to a popular revolution.”

Image result for Protests in Lebanon
Via The Daily Star

Experts have made it clear that Lebanon is not in a position to try and restructure the gigantic debt that it has accrued over the years. Even many government officials previously told Reuters that they privately believe the IMF’s bailout plan is the best solution.

The foreign debt, which the Eurobonds constitute, doesn’t even make up most of the total debt that the country. Most of Lebanon’s local debt is owed to local banks.


Our team works tirelessly to ensure Lebanese people have a reliable alternative to the politically-backed media outlets with their heavily-funded and dangerous propaganda machines. We've been detained, faced nonstop cyber attacks, censorship, attempted kidnapping, physical intimidation, and frivolous lawsuits draining our resources. Financial support from our readers keeps us fighting on your behalf. If you are financially able, please consider supporting The961's work. Support The961. Make a contribution now.