Lebanon on the Verge of Economic Collapse Within ‘Matter of Days’ Amid Anti-Government Protests

An army armored personnel carrier removes a garbage container set on fire by anti-government protesters in Beirut, Lebanon, Monday, Oct. 28, 2019. Protests have paralyzed a country already grappling with a severe fiscal crisis at reinforcing calls for the government to step down as nationwide protests entered their 12th day Monday. (AP Photo/Hussein Malla)

Lebanon’s central bank governor warned on Monday that a political solution was needed within “days” to avoid economic collapse and restore public confidence after 12 days of anti-government protests that have forced banks to close.

In an interview with CNN, Riad Salameh said that a change in government was needed to restore confidence and ensure that financial inflows — which have already slowed this year — do not dry up.

“It’s a matter of days because the cost is heavy on the country but more important we’re losing every day confidence, more and more confidence. And finance and economy is all about confidence,” Salameh said.

Prime Minister Saad Hariri’s trying “to get consensus on a new government or changes in the present government in a way to satisfy the people of Lebanon and to regain a certain trust. For the time being, there is no progress.”

Hundreds of thousands of protesters have been on the streets for over a week, demanding the resignation of the political elites they blame for endemic corruption and falling living standards. The country has been paralyzed as protesters block major highways, forcing banks, schools and many businesses to shut down.

Hariri has hinted that some change to the cabinet lineup was being considered and has said he was ready to submit to popular demands for early elections. However, the pro-Iranian Hezbollah group, which has immense sway over Lebanese politics, opposes both moves.

The armed group has accused the demonstrators of receiving foreign funds and its supporters scuffled with anti-government protesters last week in the capital.

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SOURCE: Bloomberg, Dana Khraiche