In an important stride towards the stabilization of Lebanon’s fragmented political and economic environment, the newly-formed government of Prime Minister Nawaf Salam received a vote of confidence during the late hours of Wednesday from parliament. The government, backed by 95 lawmakers within the confines of a total of 128-house chamber, is expected to perform the herculean task currently lying before it in addressing the rapidly deteriorating economic situation and the subsequent loss of confidence on the institutions of the states.
The confidence vote followed a speech by Prime Minister Salam outlining the government’s priorities, including sweeping economic reforms to be pursued, as well as the initiation of negotiations with the International Monetary Fund (IMF) this year. These two steps are seen in many circles as requirements for unlocking aid and stabilizing the downward plunge of the Lebanese economy, which has been free-falling since 2019.
“We would like to have one state that has a monopoly over decisions of war and peace and is committed to both the constitution and national accord, providing for the implementation of the provisions that have not been fulfilled,” Salam told parliament. His words seem to touch quite an important chord with many citizens, who have long been clamoring for a putative government that can bring their nation’s affairs under some semblance of authority and legitimacy.
The policy declaration of the new government did not include statements from the past which had provided legal support for Hezbollah’s defense operations in Lebanon. Lebanon’s political landscape transformed post-Israel-Hezbollah conflict due to Hezbollah’s major defeats leading them to lose their dominance in Lebanese politics.
Hezbollah has chosen to support Salam’s government notwithstanding the recent shifts in political policies. Senior Hezbollah legislative member Mohammed Raad announced during his Tuesday speech that Hezbollah will support the new government through his commitment to political collaboration. The political coalition has launched this initiative to stay important in Lebanese society while distancing from total seclusion.
According to the World Bank Lebanon experiences one of the most severe economic crises in modern times that created an environment of hyperinflation combined with mass joblessness and currency deterioration. The banking system has frozen entirely and numerous Lebanese people lost all their bank savings in the collapse. The optimistic expectations from Salam’s vow to keep depositors first and engage with the IMF reflect the current situation in Lebanon.
Government leader Salam confirmed to parliament members that his priority will include two activities: removing Lebanon from the grey list while starting IMF negotiations. “We will put depositors at the top of our priorities.”
The “grey list” refers to the Financial Action Task Force’s (FATF) classification of countries with strategic deficiencies in combating money laundering and terrorist financing. Lebanon’s inclusion on this list has further complicated its ability to attract foreign investment and access international financial markets.
Though the confidence vote was an important milestone, many Lebanese doubt that the government will be able to bring meaningful change. Decades of political corruption and mismanagement, as well as entrenched sectarianism, have eroded public confidence in the political class. For many, the new government’s failure or success will not be measured in promises but showing results.
“We’ve heard these pledges before,” said Rana, a Beirut resident who lost her job during the economic crisis. But this time, I want to believe that things can change.” We have no other choice.”
International observers have attached some urgency to the need for action. The IMF has repeatedly said any aid for Lebanon needs to come with structural reforms including reforming the banking sector, unifying exchange rates and tackling widespread corruption.
