Disputes over IMF talks stall Lebanon’s financial reforms—the details

Report by Bassam Abou Zeid, English adaptation by Mariella Succar

In the ongoing debate over Hezbollah’s exclusive possession of arms, financial reforms remain a secondary priority. 

This is reflected in the persistent tug-of-war between the government, the central bank, commercial banks, and the International Monetary Fund (IMF), which continues to delay the passage of key legislation — particularly the bank restructuring law and the financial gap bill.

The dispute stems from differing approaches, both domestic and international, to resolving Lebanon’s financial crisis, which has persisted since 2019.

Recent meetings in Washington between Lebanese officials and the IMF failed to bridge these differences.

This prompted the Association of Banks to meet with Finance Minister Yassine Jaber on Monday and Economy Minister Amer Bisat on Tuesday to discuss the progress of talks with the IMF regarding bank restructuring and the financial gap — especially since the banks consider themselves excluded from decisions related to potential solutions. 

They argue that the current situation prevents them from resuming normal operations and playing their role in reviving economic activity.

Sources following the financial situation said that the proposed amendment to the bank restructuring law, along with the clear delay in preparing the financial gap bill, indicates that the reform process remains stalled and that further delays are likely.

Amid ongoing efforts to patch up the financial system, there has been discussion about raising the amounts withdrawn by depositors benefiting from Circulars 158 and 166. 

However, the continued paralysis in enacting and implementing financial reform laws may hinder this process, even as the central bank seeks ways to overcome the obstacles — without guaranteed success.