In a speech at the Global Business Summit in Beirut, Prime Minister-designate Saad Al Hariri announced that the Lebanese government will be trying to reduce electricity subsidies by $600 million.
Hariri has high hopes that the future Cabinet will succeed in decreasing electricity bills and providing round the clock electricity power.
In fact, when he was asked about the prospects of raising taxes to reduce the deficit in 2019, Hariri said there would be no need if the government reduced the heavy subsidies on electricity.
The Lebanese state loses from $1.5 billion to $2 billion a year on the highly subsidized electricity sector. This is an amount that makes up roughly 40 per cent of the yearly budget deficit, which is around $4.5 billion.
Hariri declared during the conference: “If we save the $2 billion on energy, we will have already made $2 billion. Our problem is energy, we need to bring down the energy bill from $2 billion to zero”.
He later added: “I think in 2019 we will be able to bring it down. We are going to increase the tariffs in energy once we have 24/7 of electricity. The rolling out of our telecommunications plan must bring us more money. We need to work hard in executing a few projects that we have for 2019, spend a billion dollars on these projects in 2019 and increase our tax collection. I do not want to increase taxes and will not”.
The Lebanese electricity sector is highly corrupt and the bills people have to pay are really troubling our economy.
Fingers crossed and let us hope for the best!
N.B: This was the fifth edition of the Global Business Summit which is a conference aimed mainly at courting investment from the Lebanese diaspora.