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Khaled Abu Shakra
In a new style of form and content, the Acting Minister of Economy and Commerce, Raúl Nehme, presented the subsidy plan to be implemented. He did not go up on a platform, nor did he summon the media to his office to present his plan, but instead went to the Lebanese in general and officials in particular to show “infographics” from the platform of the MTV station.
For a quarter of an hour, Nehme summarized through drawings and data all the information related to the support quickly and clearly, blaming the government, parliament and political blocs for the responsibility of acceptance and implementation before the social explosion. It is not allowed to continue with the approved subsidy model. Apart from draining $ 550 million per month of depositors’ money, it generates economic losses of $ 400 million per month and does not reach the real beneficiaries. For example, only 6% of the total subsidy goes to gasoline. The poorest neighborhood, while the wealthy group benefits from 55 percent of the subsidies. The same applies to subsidized goods and food that benefit merchants, smugglers and the wealthy classes at the expense of the neediest groups.
Dollar support for 5 years
The point of the plan is that the 5-year support will be in US dollars and “dollars”, and not in Lebanese pounds. This protects the beneficiaries from expected fluctuations in the exchange rate. Especially since the initial reaction to the lifting of subsidies will lead to a rise in prices, a further collapse of the pound against the dollar and a deterioration in purchasing power. Therefore, each of the supported families, estimated to be between 70 and 80 percent of the family size, will receive $ 50 per month in the first year in the first year if they are over 23 years old, and $ 25 if they are under the age of 23. 23 years. As long as the value of support for people 23 and older decreases to $ 40 in the second and third years and $ 30 in the fourth and fifth years. As for those under 23 years of age, the value will gradually decrease until reaching 70 percent in the last year. To benefit from the support, people will receive financing cards, telephone applications or by opening a bank account. Where the amounts contributed by the international community are given in dollars and the amounts contributed through the budget approved by the House of Representatives are presented as electronic currency. These measures reduce the Banque du Liban’s foreign exchange pumping by $ 3 billion in the first year and reach $ 5 billion as of the third year, and achieve net cost savings of $ 2.1 billion in the first year and $ 13.7 billion over the five years. As for non-Lebanese Syrian and Palestinian refugees, their support is supposed to be funded by the World Bank and grants awarded by the European Union and Germany in the amount of $ 300 million annually, benefiting 240,000 families, or 1, 3 million people, constituting 32 percent of the population.
On the other hand, the plan maintains fuel import subsidies for the benefit of EDL. This provided that the amounts provided for electric power are adjusted in parallel with the implementation of the assumed reforms. Regarding drugs, the subsidy will remain the same until the comprehensive reform is implemented, provided that it is accompanied by the rationalization of imports and their adaptation to international standards and the promotion of the importation of generic drugs.
The logical solution to the subsidy that does not “kill the bear or die the sheep”, “will not see the light,” according to economist Jean Tawila. “Despite the importance of the plan, it first needs the approval of the Executive Branch, whose president still insists on not raising support and moving on to alternative solutions. And then the approval of Parliament and the political blocs, which will either frustrate it in the beginning or use it in outsourcing projects. And benefits for those close to her and the good ones. “According to Tawila,” if we accept an argument that the plan has received the green light and work has begun on it today, it will take at least 4 to 5 months to put implementation mechanisms are in place and begin to implement them, while the usable reserves of the Central Bank will not last more than two months at the latest. As for the bitter truth that the subsidy plan will collide with, it is that the current regime does not want to take steps to stop smuggling, and limit the accumulation of fictitious profits from lucky merchants and intermediaries at the expense of citizens. Continuous depletion of depositors’ reserves at the Banque du Liban down to the last dollar.
The success of the plan, presented by Nehme, requires a set of executive measures, including: Drafting a bill to approve this program, ensure its financing in 2021, and pass it by the House of Representatives. Ensure communication with civil society and political blocs. Invite citizens to register for the program. There is a real government. Reach an agreement with the International Monetary Fund. Starting to implement reforms. Approval of the “Capital Control” law. According to Tawila, these political conditions seem impossible so far. The different parties on all these measures since the beginning of the crisis do not seem to unite behind the support plan today, although the country has reached its last breath ”.
After the many criticisms that came to her, Grace came out in lost time with a plan that she knew perfectly well would not happen. But at least he saved his face and stripped himself of responsibility for the collapse, putting him in the crosshairs of the politicians who rule the country. He concluded his career in the public domain with the famous saying, “Oh God, bear witness to what I have accomplished.”
