After many deliberations to discuss the 2019 budget draft, including austerity measures, the Cabinet announced Monday that it has approved the plan. The budget is an effort by the Lebanese government to reduce the outstanding state deficit.
According to Finance Minister Ali Hasan Khalil, the new budget would reduce the deficit to GDP ratio by 7.59 percent, almost 3 percent more than last year’s budget. He also added that it is a crucial time to evoke a financial turning point for Lebanon, with expenses reaching around 23,340 billion LBP and 2,500 billion LBP for the electricity sector.
Moreover, Khalil emphasized that the rumors of reducing the salaries and rights of servicemen and the Lebanese University are false, as he divulged that 40 billion LPB has been allotted to the Ministry of the Displaced.
The approval meeting was the 20th consecutive Cabinet discussion over this issue, and the document remains behind schedule. The next step will be for it to go through Parliament, which will take approximately another month or so, according to Speaker Nabih Berri.
Once the document is put into action, Lebanon can ultimately secure loans as promised by international donors last year at the CEDRE conference, a total of around $11 billion, to uplift the wavering economy. The clock is ticking.
The Cabinet was initially given a moderate deadline of a month and a half by Speaker Berri back in March, yet it has exceeded that deadline by more than a month.
Meanwhile, as there is no official document to dictate government expenditure, a brow-raising financial measure to assist with government spending in the absence of this document was put in place, known as the “Provisional Twelfth,” until the end of this month.
The Provisional Twelfth has not been extended beyond May, so it’s unclear how the government will go about spending thereafter.