Blinken meets with Lebanese Prime Minister at UN amid economic crisis

U.S. Secretary of State met with Lebanese Prime Minister Najib Mikati at the United Nations Tuesday.

Lebanon has been in the grips of a three-year severe economic crisis that has left three quarters of its population in poverty after the Lebanese pound lost more than 90% of its value.

Lebanon’s GDP has sharply dropped from about $55 billion in 2018 to $20.5 billion in 2021. Tens of thousands have lost their jobs since 2019 as the crisis was made worse by coronavirus and a massive blast at Beirut’s port in August 2020, that killed over 200, wounded thousands and caused damage worth billions of dollars.

Lebanon's caretaker goverment hopes to adopt key reforms demanded by the International Monetary Fund for a long-delayed but urgently needed bailout before the end of next month.

"We are working very closely in support of Lebanon in a number of ways, particularly working through the incredibly challenging economic issues, and very much supportive of Lebanon moving forward in dealing with these challenges, including with the IMF," Blinken said at the start of their meeting.

The political class, blamed for the decades of corruption and mismanagement that led to the crisis, has been resisting reforms demanded by the international community.

Talks between Lebanon’s government and the IMF began in May 2020 and reached a staff-level agreement earlier this year in April.

However, the Lebanese government has implemented few of the IMF’s demands from the agreement, which lists five “key pillars” that should be implemented, before finalizing a bailout program. These include restructuring Lebanon's ailing financial sector, implementing fiscal reforms, the proposed restructuring of external public debt, and putting in place strong anti-corruption and anti-money laundering measures.

An IMF delegation visited Lebanese officials on Monday.