Lebanese government approves budget amid economic meltdown

Lebanon’s government approves the state budget for the current year, with a 17% deficit, the prime minister says. He describes the development as a first step in reforms desperately needed in the crisis-hit country.

The budget will now be sent to parliament for discussion and once lawmakers approve, it will go into effect. A two-day parliament session on the budget has been scheduled for February 21.

For more than two years, Lebanon has been undergoing its worst economic crisis and the newly appointed government has done little to stem the meltdown. Talks with the International Monetary Fund have failed to make progress amid deep disagreements between the government, the central bank and the banking sector.

The government has been meeting almost daily since late January to discuss the budget.

Critics say that the government deficit will be covered by printing money. That would lead the Lebanese pound, which has lost more than 90% of its value over the past two years, to lose even more value in the coming months.