Critique of the government plan

The government’s Financial Recovery Plan was met by mostly negative reactions by private sector representatives, economists, and the street. Some of them rejected the official document in its entirety. Other parties saw positive elements especially in the plan’s assessment of the magnitude of the financial ‘black hole’ as described by the Prime Minister.

The review of Lebanon Opportunities of the government’s plan shows that it has failed to come up with a correct diagnosis of the crisis and that it has made proposals that would deepen it further. We have proposed an alternative Economic Revival Plan (infopro.com.lb/revival).

Without delving into the numbers (they are outlined in the alternative plan), here are the basic points that we take issue with.

No confidence-building measures

The plan was devised behind closed doors without serious deliberations with, or involvement of stakeholders. The Central Bank (BDL), Association of Banks, and the Economic Associations have all complained of being sidelined. Other stakeholders representing labor, bank depositors, and civil society at large were either not consulted, or dealt with through hasty formalities. The plan was not paralleled by decisions to be implemented immediately and that aim to mitigate some of the urgent social or financial problems faced by citizens. To compound the problems generated by the lack of measures to restore confidence, the authorities started targeting, in a random and disruptive manner, various segments of the business sector, throwing people in jail and confiscating inventories, without due process, a behavior reminiscent of authoritarian regimes. This has resulted in a widespread attack on the plan by most stakeholders whether rightly or wrongly. What was needed was a plan that can muster support from the largest segment of the population and of the private sector, in order to kindle a light at the end of the tunnel as a start. The first good impression never materialized, and as