World Bank Insists Loan To Support Families In Lebanon Must Be Distributed In USD

World Bank Insists Loan To Support Families In Lebanon Must Be Distributed In USD

The World Bank wants the loan it has allocated to support Lebanon to be distributed to vulnerable families, exclusively in U.S. dollars, the Association of Depositors in Lebanon said on Wednesday.

In a statement, the Association quoted Saroj Kumar Jha, World Bank Regional Director for the Middle East, as saying that the Bank “insists on distributing the loan, which amounts to $246 million, exclusively in dollars,” and that “this is the official position of the World Bank.”

The Association explained that this position was clarified during a meeting between its representatives and Jha on April 13th, saying that it represents a “categorical refutation” of the statement issued by Central Bank Governor Riad Salameh on April 12.

Salameh had said in the statement in question that the Central Bank was open to disbursing money “at the parallel market rate” that would be determined by the donors and the Finance Ministry.

Jha’s remarks, the Association said, also contradict the intentions of the Lebanese government and the Administration and Finance Committee.

It also constitutes “a clear message to the government of Lebanon that the multiple exchange rate policy that the Central Bank of Lebanon adheres to is unfounded and should not be applied to the disbursement of the loan,” it added.

Notably, the Association said that the World Bank had not yet received from the Lebanese government an official response to its request to distribute the loan in U.S. dollars.

It quoted Jha as noting that the World Bank‘s position could change if a reformative program supported by the International Monetary Fund – or a legal adjustment of the official exchange rate – was not implemented by the Lebanese authorities.

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