Cardinal al-Rahi takes a swipe at Lebanon’s political leaders over the country’s debt, which is threatening its future. Lebanon announced that it would not repay a US$ 1.2 billion bond. Foreign currency reserves will be used for imports. for Prime Minister Diab, the country cannot pay its debt.
Beirut (AsiaNews/Agencies) – The Maronite Church will not let Lebanon fall and will put up fierce resistance to those who tamper with its fate, said Patriarch Card Beshara al-Rahi in Sunday Mass homily.
The cardinal was responding to Saturday’s announcements by Prime Minister Hassan Diab that Lebanon would not repay US.2 billion Eurobonds and might default on its overall debt for the first time in its history.
“It is a must to remind that the free financial and economic system – of which the banking sector is a key part and in which the Lebanese stash their lifelong savings – is a pillar of the pillars of the Lebanese entity which was established by the venerable Patriarch Elias Hoayek 100 years ago,” al-Rahi said in his sermon.
Burdened by a riisng debt, Lebanon has been experiencing its worst financial crisis since the civil war, with widespread protests and repeated appeals from the Maronite Church.
The country’s public debt stands at around US billion, almost twice (170 per cent) the Gross Domestic Product (GDP). The value of the Lebanese pound, which has been at an official fixed rate with the US dollar since 1997, has plunged on parallel markets because of inflation and unemployment.
The World Bank has forecast a recession, which could drastically increase the poverty rate, already affected by the war in Syria and the refugee crisis.
Addressing the faithful and other Lebanese in his homily yesterday, the Maronite patriarch warned Lebanese leaders against “harming” the country, and “jeopardising the future of the Lebanese”.
For him, “the reason (behind the financial crisis) is found in another place,” and the government’s duty is to “address the reasons immediately and punish those manipulating the national currency.”
Whilst noting that a “free economy is at the heart of the constitution,” for the patriarch, “the Church wants it to have a social dimension that guarantees justice, solidarity and human dignity and rights.”
The Maronite primate spoke a day after Lebanese Prime Minister Hassan Diab announced that the country would not repay US.2 billion bond due this week. For Lebanon, this is a first and a sign that things are going really bad.
At the end of a cabinet meeting and after meeting with bank representatives, the prime minister stressed that the debt had become unbearable and that Lebanon was unable to pay debt maturities.
Existing foreign currency reserves have hit a critical level and banks have imposed capital controls and refuse to exchange Lebanese pounds for dollars. This has complicated the country’s ability to import goods, reducing trade and making the crisis even worse.
The government has had to choose between using currency reserves to repay the debt or skip the payment to have capital to pay for imports.
