Lebanon

The State's Paralysis Intensifies Spending: $88 Million in One Shot!

The State's Paralysis Intensifies Spending: $88 Million in One Shot!

The newspaper Al-Liwaa reports: The paralyzed state, with its ministries and public institutions ranging from social security to the Lebanese University and government hospitals, which are searching for "anesthesia" for surgeries, along with private hospitals, is experiencing a nerve-wracking situation at bakeries after a limited and regulated supply of flour, expected to last until the end of Ramadan. Yesterday, it threw its "bankruptcy burden" and decided, during the cabinet session held yesterday morning at Baabda Palace, to allocate $60 million from the SDR (Special Drawing Rights from the International Monetary Fund) for the maintenance of electricity plants, $13 million for medication, and $15 million for wheat, totaling $88 million in one go. This comes as difficulties seem to hinder the signing of a contract to supply Egyptian gas to Lebanon, according to the Minister of Energy and Water, Walid Fayyad, who stated that it is the responsibility of the World Bank to secure the necessary funding, in addition to the United States, so that the ramifications of the Caesar Law do not negatively affect the gas transfer project to Lebanon through Syria.

However, the most concerning aspect of the cabinet's decisions is the assignment of the Council for Development and Reconstruction to oversee the demolition of the silos at the Port of Beirut. The families of the victims of the port explosion quickly took action in the evening, staging a protest against the cabinet's decision, demanding the reinforcement of the silos rather than their demolition.

The session featured various discussions. Minister of Education raised the topic of the decrees related to the Lebanese University and requested the separation of some decrees from the decree for appointing university deans, which is facing issues. President Aoun responded that in case of any disagreement on any issue, one must revert to the law and norms, and if one does not accept to go back to the law and proper procedures, it indicates an intent to obstruct. It was revealed to Al-Liwaa that the problem relates to the appointment of one of the deans outside the established mechanism.

Subsequently, the cabinet moved to the agenda items, and regarding the Social Security Fund, the Minister of Labor spoke about the fund's status and the delay in the sessions of its Board of Directors and noted that social security employees are unable to receive assistance due to the Board's non-convening. It was decided to grant them assistance similar to that provided to public sector employees. Minister Beyram mentioned that sessions of the fund's management are being obstructed, and some board members are abroad, so the council tasked the Minister of Labor with preparing a report about the situation and recommendations related to it.

Moreover, the Minister of Industry noted that the cabinet exceptionally approved, for ten days, the waiver of the certificate of good standing required for import and export while the social security issue is being addressed. In the preliminary agreement with the International Monetary Fund, the Deputy Prime Minister outlined the main points of the agreement and explained the figures and procedures related to the strategy for restructuring banks and distributing losses, and passing a banking secrecy law and forensic auditing, indicating that the program's objectives are to halt the collapse, restore stability, combat poverty, and stabilize prices.

An extensive discussion took place regarding criteria for the fair distribution of losses and depositors' funds, and Eurobond campaigns, with answers provided by Minister Al-Shami. As the questions became more complex, the council decided to approve the program as agreed with the fund, with ministers' comments to be forwarded to the Deputy Prime Minister for consideration on whether to add or amend anything.

The cabinet then moved to the item concerning the salaries of diplomats, as the Minister of Foreign Affairs had to leave the session due to travel, expressing differing views about revising their salaries. The Minister explained how the compensations for ambassadors do not cover housing, car use, and children's education, while foreign ambassadors abroad receive these benefits separately from their salaries, emphasizing that Lebanese ambassadors pay for all this out of their salaries.

The idea of reducing the compensation slightly was proposed, with clarifications regarding economic attachés, leading to a decision to hold a meeting between the Ministers of Foreign Affairs and Finance to clarify the total financial costs.

In the banking secrecy law that was approved and referred to Parliament, the Minister of Justice made observations regarding certain articles related to the tasks of investigating judges, bankruptcy courts, and the judiciary, proposing to present them to the Supreme Judicial Council. The cabinet approved the item regarding borrowing between the government and the Central Bank, amidst the reservations of the Shiite duo ministers and their insistence on not touching the bank's reserves. However, the Special Drawing Rights item is not related to borrowing, and the importance of referring any withdrawal to the cabinet for approval was emphasized.

The cabinet approved the allocation of $15 million for wheat, $13 million for serious illnesses, and $60 million for electricity. However, it was noted that the Minister of Energy had requested $78 million. In the wheat dossier, the Prime Minister pointed out the artificial crisis surrounding this issue and stressed that there are large quantities of wheat either being monopolized or misused contrary to the law, indicating that the subsidy is for bread, not for croissants, cakes, or manakish. It was decided to hold a special meeting regarding wheat to understand how to distribute the quantities imported, with information suggesting that what has been imported suffices Lebanon's needs for three years, raising questions about its consumption implying monopolization.

It was noted that 13 mills and 320 bakeries are involved. The Minister of Economy is expected to clarify the details in the special session.

Regarding the silos report, the Prime Minister presented a report by Khateeb and Alami about the silos' subsidence and the dangers posed, which recommended demolition, tasking the Council for Development and Reconstruction and the Minister of Defense to study the matter and make a final decision. The Minister of Culture was tasked with establishing a memorial for the port explosion victims, while the Minister of Public Works was to prepare a master plan for constructing new silos.

Out of the agenda, a national committee was formed to prepare for Pope Francis' visit next June, chaired by the Minister of Tourism, Walid Nassar, with the participation of relevant ministers, including Interior, Foreign Affairs, Culture, and Finance.

The Minister of Public Works also raised the issue of expanding the airport per a master plan that would allow it to accommodate 11 million passengers by 2035, while it currently accommodates 8 million. The Minister of Tourism requested a report from the Minister of Public Works to conduct a tender and provide specifications related to the expansion and urged Prime Minister Mikati to expedite the appointment of the civil aviation regulatory authority.

The case of Dr. Richard Kharat was brought up, and it was confirmed that it is being processed. The cabinet approved the establishment of a headquarters for the National Anti-Corruption Authority in a building belonging to the Ministry of Culture in Beirut, to be vacated by June.

The Minister of Displaced Affairs, Issam Sharafeddine, raised an environmental massacre in the Shmlaan area, where some had cut down a 40-year-old oak tree, threatening 200 other trees. Residents called for government intervention, notifying the Minister of Environment on Sunday, who mobilized the concerned parties, leading to the arrest of the tree cutters.

The Minister of Education, Abbas Halabi, proposed appointing deans at the Lebanese University, but it was not approved, and the file remains stuck with only two deans. When asked about the borrowing contract and whether the government bears responsibility for any withdrawals from the reserves, he responded: Regarding the special SDR withdrawals, decisions will be made in the cabinet on a piecemeal basis. No issues have arisen regarding electricity since the amount has been approved beforehand.

Concerning the recovery plan, Mikati stated: The matter is still under discussion, and not everything discussed in cabinet results in decisions. Discussions are ongoing, followed by further evaluations, and some issues may be postponed, but everything is moving in the right direction.

On remarks regarding the agreement with the fund, he said: the Lebanese government has observations, and many details will be revisited whenever the state sees a need to amend. Nothing is enforced in the end.

Minister of Labor Mustafa Beyram spoke after the session about including social security employees in assistance to end the strike. He stated about the position on banking secrecy: We are in favor of lifting banking secrecy for all those involved in public affairs. We support transparency, and the time has come in Lebanon for good governance.

The cabinet approved the urgent bill aiming to amend some articles of the law issued on 3/9/1956 related to banking secrecy and several other laws.

Regarding the Saudi-French Fund, diplomatic sources anticipated a rapid acceleration of efforts to implement the establishment of the French-Saudi support fund for the Lebanese people for humanitarian affairs after the completion of the French presidential elections. Preparatory logistical arrangements for launching the fund, agreed upon during French President Emmanuel Macron's recent visit to Saudi Arabia, have begun, although some arrangements remain before implementation, especially appointing a responsible Saudi-French committee to oversee the execution and distribution of aid directly to concerned parties and individuals.

This aid will cover the health sector, including hospitals and health centers, medications, educational institutions, charitable organizations, and also include fuel provision. Sources noted that other countries, such as the United Arab Emirates, might also join the fund.

The Saudi and Kuwaiti movements continued concerning Lebanese officials, as the Saudi ambassador to Lebanon, Walid Bukhari, met with the French ambassador, Anne Grillo. Bukhari remarked that his meeting with Ambassador Grillo was significant and fruitful, discussing the mechanisms for executing financial partnerships aimed at supporting humanitarian efforts and achieving stability and development in Lebanon, in addition to exchanging views on regional and international issues of mutual interest.

Meanwhile, regarding the elections, President Michel Aoun emphasized at the beginning of the cabinet session that we are a month away from the parliamentary elections and some still question their occurrence. He reiterated his confirmation that they are scheduled to take place on time, and additional appropriations have been approved for them. Prime Minister Najib Mikati also stated during the session: The elections will take place on time, and the required allocations are being secured. However, the "Strong Lebanon bloc" submitted a proposal yesterday to the Speaker of Parliament to amend certain articles of the electoral law to disclose all candidates' and lists' bank accounts in the upcoming election cycle.

The proposal states: A single article: First, amend paragraphs two and five of Article 59 of Law No. 44 of 17/6/2017 (election of members of Parliament) as follows: 1 - Paragraph 2: The "election campaign account" mentioned in paragraph (1) above, or any other account financed through its movement for the candidate or list’s electoral campaign, shall not be subject to banking secrecy. Both the candidate and the list shall be deemed to have waived banking secrecy concerning these accounts upon their opening or movement, with banking secrecy lifted from these accounts for 60 days starting from the date the Ministry of Interior and Municipalities announces the final results of the electoral process. 2 - Paragraph 5: It is added: The auditor shall be held personally responsible for suppressing any information or data related to any electoral spending made through the “campaign account” or any other bank account in accordance with the provisions of this article.

The reasons for this proposal include: Lebanese law does not disclose electoral spending accounts for candidates except those reported for elections, and it is clear that deliberate spending and payment of money have become evident as undeniable material facts, especially in recent times, jeopardizing the principle of transparency and the electoral process's integrity regarding electoral credibility and efficiency and constituting documented election fraud of this pivotal national entitlement, with the date of the parliamentary elections set for May 15, 2022. Therefore, we submit this urgent law proposal.

On the positions, Hezbollah’s deputy secretary-general Sheikh Naeem Qassem confirmed that "Hezbollah is fighting the elections as a battle of weights that reflect the political weights and the image of Lebanon that the Lebanese want." He stated in an interview with "Radio Nour": We do not care about the majority and the number but rather to be a significant force in the country while trying to increase the number of our deputies and those of our allies, as this helps us express our political positions. Our political choice is for the country to be liberated and free from American dependency, and we do not accept normalizing relations with Israel.

He stressed that "Hezbollah has been and remains in favor of conducting elections on time, as the internal situation can no longer accommodate further deterioration. A certain renewal must happen through the elections, potentially opening new horizons provided that reform measures are emphasized." He noted that "the question today should be directed to the other party: Does it really want to hold elections?" He felt that "there is no practical evidence from any local, regional, or international party suggesting a postponement of the elections; instead, there are hopes from these parties, along with some desires and analyses."

Sheikh Qassem asserted that "the relations between Hezbollah and France are good, as the French have realized that understanding with the parties in Lebanon necessitates including Hezbollah in that understanding, and no step will succeed for the French unless they involve Hezbollah in that process." He stated: "So far, there is American disregard for the French movements in Lebanon, and the Americans are waiting for results." He disclosed a visit by a Hezbollah delegation to the Vatican Embassy in Lebanon, highlighting that "the relationship with the Vatican is normal and based on mutual respect," stressing that "Hezbollah is one of the essential political pillars in Lebanon that no one can bypass and is ready to cooperate with any Arab or international party that is genuinely interested in Lebanon and has no conspiracy against it."

The complications related to announcing candidate lists continued, with an incident occurring between supporters of the candidates during the organization of the National Rescue list, headed by Major General Ashraf Rifi (in the North II district - Tripoli - Dinniyeh - Miniyeh), leading to shoving and altercations without reported injuries. Organizers, along with MP Othman Alameddine and General Rifi, intervened to calm the situation and continue the event, protesting the presence of a representative from the Lebanese Forces in Rifi's list.

At night, there were reports of the army deploying along the Khaldeh - Naameh road following information about some youths intending to block the road.

On the financial front, the Finance and Budget Committee, chaired by MP Ibrahim Kanaan and attended by representatives from the Ministry of Finance, made significant progress in concluding the draft budget for 2022, reaching Article 90. The committee is expected to continue its review next week and will invite the government to a meeting regarding the exchange rate adopted in the budget. It also decided to invite the Minister of Public Works to discuss the proposed fees and amendments to several articles related to his ministry and the airport.

In regard to financial and judicial matters, the Governor of the Central Bank, Riad Salameh, announced in a television interview: “I am ready to meet Swiss prosecutors in person and respond to their questions regarding their investigation into money laundering.” Salameh, in a dialogue with an investigative program on the Swiss channel SRF, stated he had informed Swiss judicial authorities of his readiness to go there. He added that he was asked in February 2020 if they could meet him in Lebanon or Switzerland, and he expressed his willingness to travel to Switzerland and is awaiting their summons.

Responding to questions about properties he owns in Switzerland through companies, including a building in the city of Morges on Lake Geneva, he stated that he had not seen it before and clarified that he benefited from investment consultations and banking loans to purchase the property, asserting that he does not see a crime in that.

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