Asia

Lebanon resumes 'interactions' with IMF, committed to fair solution for creditors

FILE PHOTO: A man counts U.S. dollar banknotes at a currency exchange shop in Beirut, Lebanon, June 11, 2021. REUTERS/Mohamed Azakir/File Photo

BEIRUT (Reuters) – Lebanon has resumed “interactions” with the International Monetary Fund with a view to agreeing an “appropriate recovery program”, the finance ministry said on Monday, as Prime Minister Najib Mikati’s new government seeks to address the country’s devastating economic meltdown.

In a statement, the ministry also said the government remains “fully committed to engage in a constructive, transparent and equitable debt restructuring process with all other stakeholders”, welcoming the interest of bondholders to participate in the process.

“The government reiterates its commitment to a fair and comprehensive solution for all creditors and will engage … in good faith discussions with all its creditors as early as practicable,” it said.

Lebanon has been in deep financial crisis since late 2019, since when the currency has lost some 90% of its value, poverty has soared, and the banking system has been paralysed.

The country defaulted on its sovereign debt in March 2020, saying it needed its foreign currency reserves to meet basic needs.

Talks between the former Lebanese government and the IMF broke down last summer, in large part due to a disagreement between the Lebanese government on the one hand, and the banks, the central bank, and ruling political parties on the other, over the scale of losses in the financial system.

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