IMF: Lebanon Negotiations are ‘Complex’

A spokesman for the International Monetary Fund said the ongoing negotiations with Lebanon are “complex” and require a joint diagnosis of the source and magnitude of the financial losses, noting on the other hand that the GDP may contract “deeper-than-expected" in the second quarter of 2020.

IMF spokesman Gerry Rice said Thursday that the fund was still in discussions with Lebanon about possible financing arrangements. He said it was too early to talk about the size of any aid program.

Rice declined to give any details of the reforms the fund wants in order to approve a program. He said the Lebanese government needed to implement comprehensive and equitable reforms in many areas.

“Lebanon needs to reach a common understanding of the source and size of its financial losses,” he said in an online briefing.

"Discussions are underway," stated Rice. "These are complex issues that require a joint diagnosis of the sources and magnitude of losses in the financial system, as well as feasible options for their effective and equitable treatment.”

Hopes for a quick bailout deal with the IMF were complicated because of a dispute between the government and the Central Bank of Lebanon over the size of the losses in the financial system.

Rice's statements made clear that the IMF expects Lebanon to solve these problems and move forward with a series of broad reforms.

"There is a need for comprehensive reforms in many areas, which requires acceptance and consensus from the society as a whole," he said.