Lebanon at odds over whether budget is finished

Credit: REUTERS/DENIS BALIBOUSE

Lebanon's foreign minister said on Thursday more work was needed to bring down the deficit in the draft state budget, as other top officials warned against further delays to finalising the plan.

Adds comments from Hasbani, Jumblatt

BEIRUT, May 23 (Reuters) - Lebanon's foreign minister said on Thursday more work was needed to bring down the deficit in the draft state budget, as other top officials warned against further delays to finalising the plan.

The governmentof Lebanon, which has one of the world's heaviest public debt burdens, is vowing to enact reforms that have been put off for years. Top officials have warned of crisis unless action is taken in this budget.

The cabinet once again missed a self-imposed deadline on Wednesday and scheduled a final session for Friday.

Prime Minister Saad al-Hariri's government groups nearly all of Lebanon's rival parties. Measures approved so far have brought the deficit to 7.5% of GDP from some 11.2% in 2018.

Finance Minister Ali Hassan Khalil declared the budget complete at the start of the week. On Wednesday, he warned that every day the budget was not passed there was "a cost to market confidence".

But Foreign Minister Gebran Bassil insists more can be done and his comments at a televised news conference on Thursday indicated the row could drag on.

"What we will do in the coming days is continue our positive work. We want to complete the budget quickly and we must take bold decisions," he said. The current reduction was "not enough to solve the exceptional situation in the country," he added.

Walid Jumblatt, the influential Druze politician, weighed into the row on Twitter, saying it was time to complete the budget and focus on next year's one.

"Completing the budget is more important than obstructing it and going into futile debate," he wrote.

Lawmakers of the Iran-backed Hezbollah movement called for finishing the budget and rapidly sending it to parliament. They added that while the draft budget reduced wastage of public money, it did not "embody a coherent reformist vision".

Deputy Prime Minister Ghassan Hasbani, speaking to Reuters by phone on Thursday, said additional ideas under discussion were valid but amounted to "small, incremental points".

"I am not saying they are not worth discussing but the return on time invested in the last week or so has not been high," he said.

"Catastrophe has been avoided through this stabilisation budget but much more needs to be done on the structural reform side in order to build growth going forward to avoid any future problems," Hasbani, a member of the Lebanese Forces party, said.

(Reporting by Ellen Francis/Tom Perry Editing by Gareth Jones and Catherine Evans)

((Ellen.Francis@thomsonreuters.com))

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