March budget target not impossible: Lebanese Deputy PM

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BEIRUT - A high-ranking official in Prime Minister Saad Hariri’s government said Tuesday that he had doubts Lebanon’s 2018 budget could be passed by the premier’s March 5 target, but that it was not impossible. The goal was set so the budget would be agreed before three international donor conferences to support Lebanon take place in the coming months. “I think it will be a challenge to pass the budget before the conferences, especially with the election period. But it is not an insurmountable challenge,” Deputy Prime Minister and Health Minister Ghassan Hasbani said in a telephone call with The Daily Star.

The Rome II and the Paris Cedre Conference meets are set to be held on March 15 and April 6 respectively, while Lebanon’s first parliamentary elections in nine years are set for May 6. International bodies and governments have urged Lebanon to pass a budget before Rome II, which is aimed at garnering support for Lebanon’s security apparatuses, and particularly before the Cedre Conference, which looks to bolster Lebanon’s economy.

The main laws that need to be amended, Hasbani said, are the privatization of the telecoms and electricity sectors. “The laws were passed in 2002 to privatize telecoms, which provides an income of billions of dollars to the government,” he said. While calls have been made for ministries to reduce their respective budgets, “people don’t want a 5-percent cut in the budget, trimming down the running cost of ministries or cutting social support at the worst time possible,” Hasbani added.

Rather, the deputy premier claimed that the two sectors could be privatized within a matter of months with the right political will.

“There can be a type of revenue sharing and government counterpart financing,” he said.

Curbing corruption and improving tax collection were other areas under discussion.

Hasbani said that fighting corruption in particular would be an important signal to investors and the international community.

Tax increases will not feature in the 2018 budget as tax reforms were only recently implemented at the end of 2017. “We’re waiting on the results of those first,” Hasbani said.

Finance Minister Ali Hasan Khalil said specific numbers for the ministries were discussed and “it was clear that there is a serious commitment to the reduction [of ministry budgets by] 20 percent.” The prime minister has called on ministries, government agencies and public institutions to cut their budgets by 20 percent, without touching salaries and wages.

Among the items covered Tuesday were the budgets of the presidency, Parliament and Cabinet, including affiliated departments.

“The results of the discussions were positive and they will continue during meetings at the Serail Wednesday and Thursday,” Khalil said, according to Hariri’s media office.

Hariri headed the second meeting in as many days at the Grand Serail.

It was attended by Hasbani and Khalil, as well as ministers Mohammad Fneish, Michel Pharaon, Ayman Choucair, Raed Khoury, Youssef Fenianos and Avedis Guidanian.

The committee will hold an open-ended meeting before finalizing the draft to be presented to Cabinet.

It will then be sent to Parliament for ratification.