IMF warns Lebanon at 'very dangerous moment'

Crisis-hit Lebanon is "at a very dangerous moment", a visiting International Monetary Fund delegation said Thursday, criticising slow progress on reforms needed to unlock billions in loans.

Lebanon and the IMF reached a conditional agreement in April 2022 on a $3-billion-dollar loan needed to save the country's economy, in free fall since 2019.

But nearly a year after Beirut signed the agreement, officials have yet to enact the substantial changes required to kickstart the 46-month financing programme.

Since last year, the country has had no president and only a caretaker government, amid persistent deadlock between rival factions while the country plunges deeper into a crisis dubbed by the World Bank as one of the world's worst since the mid-19th century.

"We think Lebanon is at a very dangerous moment, at a crossroads," said Ernesto Ramirez Rigo, who headed the IMF delegation to Beirut.

He warned the continued "policy of inaction is going to leave Lebanon in a never-ending crisis".

"Time has gone by. It's almost a year since we have reached an agreement," Rigo added, urging leaders to implement the reforms swiftly.

"The country is in a significant crisis. One would have expected a lot more in terms of implementation and approval of legislation," added Rigo.

In September he had already warned of tardiness in implementing reforms, "despite the urgency".

Lebanon's meltdown has pushed most of the population into poverty while the political elite, widely blamed for the country's financial collapse, has failed to take action.

If the status quo persists, the country could see hyperinflation, "in a worst case scenario" Rigo said.