JUNE 28, 2021
US and France United in Applying Pressure
BDL Asks the Government to Authorize Bank Loans to the State
David Gardner Writes on Forthcoming Sanctions
US and France United in Applying Pressure on Lebanese Officials
In a press conference, US Secretary of State Tony Blinken and French Foreign Minister Jean-Yves Le Drian stated their intentions to work together to pressure Lebanese officials to act. Le Drian said, “We have decided to put pressure on those responsible. We know who they are.” Blinken added, “We need to see real leadership in Beirut.” [The Arab Weekly]
ANALYSIS
“The announcement by the US and France to join together to ramp up pressure on Lebanese politicians is a hopeful sign. This is a last ditch effort to encourage Lebanon‘s political leaders to finally put in place a reformist government capable of addressing the needs of the Lebanese people. They should be joined now with the International Support Group and other countries that will speak with one voice, and leave no choice but for the political leaders to respond to the needs of their citizens or face the consequences of sanctions on individual obstructionists.”
-ATFL President Edward M. Gabriel
Read ATFL’s response to joint US-France action here.
BDL Asks the Government to Authorize Bank Loans to the State
The Banque Du Liban recently asked the government in a statement to provide the central bank with a legal basis to lend the government foreign currency from its reserves. The loan would help fund subsidized fuel imports. [Reuters] In the statement, BDL stressed Article 91 of the Money and Credit Law which requires the central bank to grant the government loans from its foreign currency reserves. [The Daily Star]
ANALYSIS
“Riad Salameh, the Governor of the Central Bank, is in no mood to do the government any favors. He says that the Bank was compelled by legislation to fund huge government deficits in the past decade which led to the economic freefall that became widespread in 2019. Now, with subsidies draining the remaining liquidity in the Bank and President Aoun calling for continued subsidies for fuel imports, the Bank has asked the government to take the necessary legal steps, undefined, to begin using its reserves to keep vehicles moving. The Bank has become a champion for reforming the subsidy regime and is calling for broad reforms in the public sector as well. Will the government agree to share the hot seat of public anger?”
-ATFL Policy Director Jean AbiNader
OPINION PIECE
David Gardner Writes on Forthcoming Sanctions on Lebanese Politicians
In a Financial Times op-ed, David Gardner says sanctions could force Lebanon’s political leaders to govern by forming a cabinet and making necessary reforms, and indeed sanctions on certain officials are being prepared. He writes, “There is growing conviction inside and outside Lebanon that the elites will only start to bargain if their bank accounts and property assets (mostly abroad are hit and they are prevented from traveling.”
ANALYSIS
“There is an argument repeated frequently that sanctions don’t work, so why bother. Well, ask Iran why it’s bothering to get out from under sanctions in the Vienna talks. Sanctions, if targeted at the right individuals regardless of affiliation, can be a useful tool in reining in kleptocrats who care little for the damage they do to satisfy their greed. Sanctions by France, the UK, and Switzerland are critical to the success of a sanctions regime since most Lebanese leaders have their assets in Europe, not the US. It would be helpful if expatriate Lebanese in those countries, working with Transparency International Lebanon and others could expedite sanctions on personal fortunes tucked away in Europe.”
-ATFL Policy Director Jean AbiNader
Disclaimer: The views and opinions expressed are those of the author and do not necessarily reflect the position of the American Task Force on Lebanon, a non-profit, nonpartisan leadership organization of Lebanese-Americans.