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Beirut violence is a setback but will be overcome

© Reuters. Najib Mikati is the Lebanese Prime Minster during a Reuters interview at Beirut’s government palace, Lebanon on October 14, 2021. REUTERS/Mohamed Azakir

Maha El Dahan and Laila Bassam

BEIRUT, (Reuters) – The Lebanon Prime Minister Najib Mikati stated Thursday’s violence was a setback that the country would overcome. His cabinet worked to give the International Monetary Fund (IMF), the necessary financial figures in preparation for talks to rescue the country from economic collapse.

Mikati talked to Reuters following a shooting that killed six Shiites in Beirut’s capital.

The difficult period Lebanon is currently in is not easy. Mikati described us as a patient at an emergency room.

He said that there were many steps to recover from the crisis, adding that the central bank of Nigeria had no foreign currency liquidity that it could use.

Mikati’s cabinet came to power last month following more than a decade of political infighting. The focus was on IMF talks for reviving the country out of deep financial crises that have pushed over three quarters into poverty.

However, the dispute over who was the investigator of the Beirut port explosion that killed dozens last year threatened to ensnare it. Shiite ministers, allies to Amal and Hezbollah movements, called for his resignation.

Mikati replied, “Everyone should resign if he wants,” when Mikati was asked whether any ministers were threatening to resign because of the request.

He claimed that politicians shouldn’t interfere with the judiciary, and the court should rectify its mistakes.

He stated, “A judge must firstly protect both the law and constitution.”

Many, including me, believe there may be a constitutional mistake. However the judiciary must decide this and it can correct itself. Not politicians.

Mikati stated that the IMF would receive the financial information it needed “in the next days” despite the distracting effect of the cabinet’s attention on the economic recovery.

In 2019, the financial system of Lebanon collapsed after years of corruption and waste by the state, as well as the inefficient financing.

In the two-year period, more than 90% has been lost in value. The World Bank has called the current economic crisis one of the most severe depressions in recent history.

The IMF negotiations were stopped last year, after the former government created a plan for financial recovery that estimated losses in excess of $90 billion to the financial sector.

While the IMF supported the number, most of Lebanon’s political actors disagreed with the magnitude of the losses.

Mikati refused to answer questions about whether there was a new distribution or loss figure. He said that he couldn’t reveal the data without sharing them with the IMF.

Lazard, an advisory financial firm (NYSE.:) created the original Lebanon recovery plan last year. It was requested to continue that role following Mikati’s formation of his cabinet. Mikati stated that it is waiting for figures to be delivered by the government in order to finish their plan.

I would like to see (figures handed over sooner than expected) but… due to the current circumstances, there is some delay that is beyond our control but the IMF talks will soon start informally and fully.

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Mike Robinson
Mike covers the financial, utilities and biotechnology sectors for Street Register. He has been writing about investment and personal finance topics for almost 12 years. Mike has an MBA in Finance from Wake Forest University.