Lebanon has been plunged into one crisis after another, beginning with mass protests and economic turmoil and recently with the explosion in Beirut that killed more than 220 and destroyed vast amounts of infrastructure. As a result, the entire cabinet of Prime Minister Hassan Diab resigned just days after, making room for a new government to take its place.
Mustapha Adib Named as New Lebanese PM
On Monday, President Michel Aoun named Mustapha Adib as the new Prime Minister. Adib becomes the third person to hold the office since January of this year. He was voted in by 90 of the 120 members of parliament, with backing from the Shiite Hezbollah and Amal movement, as well as the Sunni Future Movement of former leader Saad Hariri.
The new PM — required to be a Sunni under the Doha Agreement — has the monumental task of rebuilding Beirut’s infrastructure and gaining the trust of a frustrated populace, which has been protesting on and off for almost a year.
“There is no time for talk, promises and wishes. It is a time for action,” Adib said in his first speech.
Lebanon’s Economy is in Freefall
Adib’s job becomes extraordinarily difficult considering the state of Lebanese economy, which is facing one of the worst turmoils in history. The country’s gross domestic product is expected to plunge by 12% in 2020 while public debt levels near 175% of the GDP. Adding to the troubles is the unemployment rate of around 25% while the budget deficit is approximately 15%, making the prospect of any new reconstruction and comeback even more daunting.
Lebanon’s economic crisis has been brewing for a long time now, as just in March the country defaulted on its dollar-denominated bonds for the first time ever. Adib is expected to revive talks with the International Monetary Fund for a $10 billion facility after the previous round in early July failed. But given the long-term sovereign credit outlook — downgraded by Fitch to CCC, a non-investment grade — it’s going to be a tough sell.
‘The IMF is Exploring All Possible Ways to Support the People of Lebanon’
After the August explosions, some hope for support emerged as France’s Emmanuel Macron rallied to Lebanon’s cause while IMF’s Managing Director Kristalina Georgieva said: “The IMF is exploring all possible ways to support the people of Lebanon. It is essential to overcome the impasse in the discussions on critical reforms and put in place a meaningful program to turn around the economy and build accountability and trust in the future of the country.”
Before any negotiations with the multilateral lender, Adib will meet with Macron, who played an instrumental role by pressuring the ruling elite to name a new candidate. The French President is trying to get more international financial support for Lebanon’s development and fiscal management.
However, there are now questions whether the new leader can bring any meaningful change to the rotten system or is it merely a change of face. Adib had been serving as the Lebanese ambassador to Germany since 2013 and like his predecessor Hassan Diab, is an academic by qualification and has previously taught at a number of universities. Similarly, his political days go back to the time of billionaire PM Najeeb Mikati with whom he served as an advisor.
Hence, his appointment is unlikely to be welcomed by the general public that has been protesting to completely overhaul the current political system and get rid of the corrupt ruling elite who have captured the government.
Adib, too, seems to be a member of that same exclusive club.