Lebanon is using funds from the “International Monetary Fund” to start the implementation of the electricity plan

With the aim of avoiding a political confrontation on “legislation of necessity”

The first phase of the national electricity sector contingency plan, which will provide citizens with 8 to 10 hours of electricity a day in exchange for a tariff increase, is expected to proceed without significant hurdles after deductions by interim Prime Minister Najib Mikati in coordination and collaboration with the speaker of the parliament Nabih Berri and the governor, the Banque du Liban, Riad Salameh, and the finance minister in the interim government, Youssef Al-Khalil, have proposed a solution that does not require the passage of the House of Representatives for avoid the refusal of opposition forces to hold any legislative session and ask them to adhere to the provisions of the constitution, “which provides that Parliament will be transformed into an exclusively elective body with the end of the mandate of former President Michel Aoun”.

According to information from Asharq Al-Awsat, the solution requires drawing on the remaining funds that Lebanon obtained in September 2021 from the International Monetary Fund, amounting to $1.135 billion, as an allowance for Special Drawing Rights (SDRs).

Originally, only $300 million of these funds remained, which will be used to launch this plan. However, according to ministerial sources who spoke to Asharq Al-Awsat, “this amount is only enough for two months to finance the plan, and it has been agreed that during this period the bills will be collected according to the new rate and the money will be taken to the Banque du Liban to buy dollars with which it will be used to finance the additional 4 months you notice.” plan”. The sources indicate that “thus, the termination of the appeal to the House of Representatives, a large number of whose members refuse to return to the legislation, is being circumvented, and it is assumed that it will be an elective body for the president of the country, just as we have circumvented the categorical refusal of the Banque du Liban to harm the compulsory reserve to finance the electricity plan without passing a law in this regard».

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This plan links between guaranteeing this number of power hours and increasing the tariff, which means that the two things will happen in parallel, while the price of a kilowatt-hour has become 10 cents for the first 100 kilowatt-hours consumed and 27 cents per kilowatt hour for higher consumption, noting that the price, approved since the 1990s, is approximately one cent per kilowatt hour. Asharq Al-Awsat also learned that Mikati told a number of lawmakers he had met recently that he would coordinate with Energy Minister Walid Fayyad to toughen the issue of bill collection, noting that around 60% of Lebanese pay the bills, and the rest is not paid. Therefore, according to the new plan, electricity will be cut off for those who do not pay.

In recent days there has been a broad debate among those interested in the file on how to obtain financing for the first phase of the electricity plan, pending the completion of the collection according to the new tariff. It was assumed that a law would be enacted by Parliament to approve a cash advance in the interest of the Electricité du Liban for the purchase of energy (fuel) and the increase in power hours, especially if interested parties would resort to the compulsory reserve.

The constitutional lawyer, lawyer Saeed Malik, explains that “it is demonstrated that the issue of the electricity loan requires the enactment of a law on the matter by the House of Representatives on the basis of a bill presented by the government, provided that the assembly is held by an ordinary majority, i.e. 65 deputies, and the majority of those present is recognized by normal law”.

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He added, in a statement to Asharq Al-Awsat, that “the use of special drawing rights funds is an attempt to circumvent the need to enact a law, and it is a narrow attempt, both in terms of possibilities and in terms of time, and there is no possibility in the future but to return to enact a law by the House of Representatives”.

The opposition forces refuse to participate in any legislative session that the Speaker of Parliament may request, even if under the heading of “legislation of necessity”.

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