Caretaker finance minister Ghazi Wazni has warned that Lebanon will run out of money to afford basic imports by the end of May if Lebanon does not ration its remaining foreign currency reserves, according to a Reuters report.
The caretaker Cabinet must form an action plan to lift subsidies and, according to Wazni, delays in launching the plan are costing $500 million per month.
“The government must speed this up. The cost of wasting time is very high. With every delay, it becomes higher,” he was quoted as saying by Reuters.
About the plan, Wazni said that it would consist of reducing subsidized foods from 300 to 100 goods, reducing subsidies on fuel and medicine, and introducing a ration card for 800,000 poor families. This, according to him, will reduce the subsidies’ annual spending to $6 billion.
He acknowledged that lifting subsidies is a difficult decision for the caretaker government to make but deemed it “necessary.” He added that it is long overdue.
Right now, Lebanon has around $15.8 billion in foreign currency reserves, according to Wazni, giving Lebanon a maximum of 2 months before hitting obligatory reserves that are estimated at $15 billion, Reuters wrote.
Wazi, like many local politicians, also urged the need for a new government that could restart talks with the International Monetary Fund (IMF) to provide desperately needed funds and rescue Lebanon from its social and economic crises.
In related news, Lebanon’s Central Bank can no longer print more cash, as it exceeded the money creation limit set by the law.
