The US ambassador in Beirut Friday reprimanded Hezbollah for Lebanon and jeopardizing the country’s economic recovery.
“By its actions and threats, Hezbollah destabilizes the country and jeopardizes the country’s economic recovery,” Ambassador Dorothy Shea said in an interview with Al Hadath.
Hasan Nasrallah, Hezbollah’s secretary-general, recently accused the US and its embassy in Lebanon of trying to starve the Lebanese people through economic sanctions.
Shea vehemently rejected these accusations. “While he accuses us of starving Lebanon, your viewers might be interested to know that, just recently, we gave $13 million” in new emergency food aid to those most vulnerable inside Lebanon.
The US diplomat said Nasrallah’s most recent speech was riddled with “classic deflection blaming everything on the US when we are [Lebanon’s] largest donor,” with close to $5 billion in humanitarian, economic and security assistance over the last two decades.
Shea said that Washington was still evaluating whether Prime Minister Hassan Diab’s government was truly independent and “not beholden to Hezbollah.”
“We continue to have very serious reservations in this regard, and we also have not yet seen what we would have hoped for from this government, in the way of concrete steps to implement reforms,” that the Lebanese economy badly needs.
Diab, backed by Hezbollah and its allies, formed a government at the beginning of the year that was boycotted by pro-Gulf and pro-West parties, including former PM Saad Hariri and the Lebanese Forces.
The current government pushed ahead with financial and banking appointments at the country’s central bank despite widespread criticism that the appointments were made based on political agendas, rather than merit. “Making appointments based on politics, as usual, is not going to help recover Lebanon’s failed economic and financial model, nor is it helping to rebuild confidence,” Shea told Al Hadath.
Shea said that she tried to convey the importance of having credible and internationally respected experts at the central bank, but that ultimately the appointments were a matter for the Lebanese government to decide.
International aid and the IMF
Blaming the current and prior governments of Lebanon for decades of corruption and financial mismanagement, Shea said that Hezbollah had “siphoned off billions of dollars that should have gone into government coffers so that the government could provide basic service to its people.”
Meanwhile, the group, designated a terrorist organization by Washington, has obstructed some of the economic reforms needed in Lebanon, Shea said.
Also Friday, the International Monetary Fund Managing Director Kristalina Georgieva revealed that she does not yet have reason to see a breakthrough in negotiations with Lebanon to help resolve the country’s economic crisis.
Georgieva told a Reuters Newsmaker webcast event that IMF officials continue to work with Lebanon, but it is unclear whether the country’s leaders, stakeholders and society can unify around reforms needed to stabilize its economy and return it to a growth path.
The national currency has lost more than 75 percent of its value over the last eight months, plunging to its lowest rate.
After defaulting for the first time, Lebanon went to the IMF for help. However, it has failed to close ranks over the scale of losses in the banking system. The government and central bank have been at loggerheads over the correct number, while Diab’s government has not implemented reforms requested.
“The core of the issue is whether there can be a unity of purpose in the country that can then carry forward a set of very tough but necessary measures,” Georgieva said. “All I can say is that we are putting our best people to work with Lebanon, but we do not yet have a reason to say there is a breakthrough.”
Georgieva said Lebanon’s situation “breaks my heart” because it has a strong entrepreneurial culture and has taken in Palestinian and Syrian refugees, helping to ease a major humanitarian crisis.
Shea, the US ambassador, noted that Lebanon had started talks with the IMF, but that they had yet to commit to a plan of action or even “started actual negotiations.”