Finance Minister calls on reforming salary payments in light of IMF's reform recommendations

Lebanon Economy
2023-07-05 | 06:24
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Finance Minister calls on reforming salary payments in light of IMF's reform recommendations
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3min
Finance Minister calls on reforming salary payments in light of IMF's reform recommendations

The caretaker Finance Minister, Youssef Khalil, considered the International Monetary Fund's Article IV report, issued in late June, to reflect the current financial and economic situation accurately.

In response to the latest IMF report, Khalil emphasized the importance of implementing the recommended reforms, as they are crucial for the urgent need to revive the economy and put the country on a path of recovery. Failure to implement these reforms would incur significant costs that would hinder any possibility of uplifting the economy and progressing.

He believed that pursuing these reforms would yield higher growth rates than those projected in the report, based on the adaptability and resilience of the Lebanese economy in overcoming obstacles, which is already evident in some productive sectors.

Khalil also highlighted the positive impact of recent developments on public finance, particularly concerning exchange rate unification, fee, and tax collection, restoring the Treasury's financial capacity, and enhancing liquidity management for economic and monetary stability.

Despite the significant challenges, the Ministry is focused on completing the 2023 budget project, which builds upon corrective measures implemented following the approval of the 2022 budget. Khalil emphasized that the budget project will be submitted to the Cabinet soon, serving as a supportive factor for financial regularity.

The Ministry seeks to secure the needs of the public sector by bolstering treasury revenues within the framework of macroeconomic principles without posing a risk to financial and monetary stability.

Regarding recent compensations approved by the Cabinet, Khalil clarified that they were based on the available imports in order to avoid exerting pressures on the monetary situation and exchange rate. He stressed the necessity of reforming the salary scale, acknowledging that it is imperative due to the severe crisis.

The government is working with various entities and donor countries, through the Lebanon Financing Facility and the World Bank, to conduct a job survey of the public sector. This survey will serve as an initial step in reforming the public sector and correcting the salary scale.

Moreover, Khalil revealed that the World Bank has agreed to fund an additional loan to complete the project to support the poorest families. This comes as a result of the limited financial capabilities of the state and the scarcity of credits allocated to social spending in the budget.

Regarding Lebanon's obligations to international organizations and donors, Khalil confirmed that the Finance Ministry is gradually fulfilling its due commitments in coordination and communication with these donor entities, particularly regarding the arrears that Lebanon has fallen behind in paying on time. He commended the continuous support of the IMF in enabling Lebanon to overcome its current crisis.

Lebanon Economy

Finance

Minister

Call

Reforming

Salary

Payments

IMF

Recommendations

Economy

Lebanon

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