The most likely outcome, as far as the most recent news seems to suggest, is that the government will choose to default on its debt.
This is why Lebanese officials are considering the possibility of asking local banks to buy back the Eurobonds that they sold to foreign funds.
Former finance minister Ali Hassan Khalil was in a meeting on March 2nd with bankers and officials to discuss the Eurobonds. According to him, the reason for this move would be that the Funds that had bought those bonds have greater leverage over potential restructuring positions if Lebanon decides to default.
Buying back the bonds will help regain a majority in the decision-making process of debt restructuring. Lebanon needs the approval of at least 75% of bondholders in order to make a decision about debt restructuring.
Khalil added that the banks should buy back these bonds from their own funds and not use the depositor’s money because they are responsible for this financial crisis.
An important note to add is that Khalil shares the position of his party, the Amal Movement, against repaying the debt.
Given that Amal, Hezbollah, and their allies are basically in control of the country, the likelihood that Lebanon will choose to default on its debt is getting higher and higher.