What Should be the Priorities for the Miqati Government?

Friday, September 17, 2021
Opinion by Jean AbiNader

There is no mystery about the challenges facing the new government, both from within the new lineup and the street. Miqati’s team is already showing tendencies to argue to protect and project their interests while the overall need is for a national consensus about what can be done in the next eight months to make a difference in the economic and political life of the Lebanese.

Based on conversations both in the US and abroad, a complete list of priorities is difficult since the time is short. But here are some that are both doable and necessary.

As the ministerial statement emphasizes, the first priority is to start negotiations with the IMF to stop the economic slide, put more money in people’s pockets, address corruption, and start the long process of reconstruction. Begin by dividing the Special Drawing Rights coming into the Central Bank amounting to some $1.13 billion, into three pots: one to replace subsidies and fund the cash cards, the second is to strengthen the Central Bank’s liquidity and the Lebanese lira so that it has real purchasing power, and the third is to maintain essential support for the LAF and ISF.

To address corruption, the core issues are completing an independent and transparent investigation of the Beirut Port explosion, implementing the capital controls law passed by the Parliament to regulate currency transfers, and use existing laws to work with other countries to pursue funds spirited out of the country around the October 17, 2019 demonstrations. That’s a lot in eight months but the process has already started and will be helped by immunity for whistleblowers, a draft law already in Parliament’s hands. The ministerial statement also calls for a complete investigation of the Beirut Port blast but does not spell out by whom or a timeframe, while emphasizing that immunities from prosecution will follow existing law – not altogether reassuring.

There are several ways to provide people with a better standard of living: increase the value of the lira, increase the supply of essential products and services, and reduce their costs. Building trust and bringing stakeholders into the process is critical. Immediate reform and restructuring of the electricity sector is the priority as a consistent power supply enables businesses, public services, transportation, and IT to move forward. The competing fuel supplies from Iran and the three-way transfer of electricity and Egyptian fuel oil through Jordan and Syria must precariously balance the needs of the people versus enriching those who can manipulate the energy supply scenario to enhance their political bona fides.

With electricity and power restored, emergency services, hospitals, schools, the water system, and other key components can recover and restart, giving people a sense of normalcy. While electricity is only the start, there can also be a push to implement legislation already in the Parliament that would advance other infrastructure reforms such as telecommunications and the ports, reduce the national budget, provide oversight for expanding the social services safety net, and prepares the necessary conditions for free and fair elections.

Creating domestic credibility and momentum by initiating visible and impactful positive steps will help ease the brain drain and restore some impetus for increased remittances and overseas investments.

The political agenda also has several components: supporting the LAF and ISF, efficiently preparing for free and fair elections, and taking the necessary steps on a rigorous timetable to fully inform voters of their rights and the process to follow. The need for security has become a major concern for the Lebanese, and so supporting the overall security apparatus is both an economic and political priority. Protection of civil and human rights must again be at the forefront of those responsible for public order. Once IMF negotiations are successful, it would be very helpful for the US, UK, and Germany to resume their training programs, assist in building an effective national vaccination campaign, and ensure that morale is strengthened.

It is inevitable that there will be political frictions among the members of the Cabinet and Parliament who will resist the erosion of their sectarian interests. PM-designate Miqati has come this far using his powers of persuasion and deep knowledge of the players. Moving this lineup to adopt a ministerial statement that shows determination and sacrifice from the top will start to bring credibility and trust to ties with the people. The statement adopted after three rounds of negotiations is a start, but it will be subject to a great deal of scrutiny. There will be no honeymoon period. The time to act is now.

The views and opinions expressed here are those of the author and do not necessarily reflect the position of the American Task Force on Lebanon.