Berri Says $900M Expected from IMF as MPs OK Ration Card

Parliament Speaker Nabih Berri announced Wednesday that the International Monetary Fund is expected to grant Lebanon’s central bank $900 million on September 23, as parliament approved the ration card plan during a legislative session at the UNESCO Palace.

“The IMF decided Monday to return the reserves lodged by some countries with it and Lebanon’s share from this issue is $900 million,” Berri told parliament, adding that the caretaker finance minister “has been informed of this.”

As for the ration card plan, the Speaker said the financing and mechanisms of the scheme are “the responsibility of the government, not parliament, in line with norms.”

“The government has pledged to implement the subsidies rationalization program… and the ration card will have a (monthly) value of $93.3 to $126,” Berri added.

The cards, which are targeted at the poorest segments of society, aim to cushion the gradual collapse of subsidies due to the economic crisis.

The decision comes one day after authorities hiked the price of subsidized fuel to shore up dwindling foreign currency reserves at the central bank.

The government, which subsidizes key commodities including flour and medicine, has also started to gradually reduce support on other key items, after months of deliberations and without any official announcement.

Lebanon is in the throes of an economic crisis the World Bank has described as likely one of the world's worst in modern times.

More than half the population lives below the poverty line and minimum wages are the equivalent of less than $40 a month, according to the black market exchange rate.

On Wednesday, parliament "approved... the ration card system and the opening of special credit lines to fund it," the official National News Agency reported.

Government estimates put the cost of the initiative at $556 million -- $300 million of which officials hope to secure through World Bank loans, and the rest of which is to come from the central bank, a government official told AFP.

Berri said it would also be up to the government to determine how to distribute the cards, which exclude residents that already benefit from outside assistance.

The government official, who spoke on the condition of anonymity, said half a million families would receive ration cards.

Tuesday's steep fuel price hike has caused Lebanese to brace for higher transportation and electricity costs, and in turn higher receipts for services and goods, including bread.

Subscriptions to private generators, which in some regions operate for 22 hours a day, are expected to become especially expensive.

This is all expected to compound woes in a country whose currency has already lost more than 90 percent of its black market value against the dollar.

The Lebanese pound, pegged at 1,507 to the greenback since 1997, has traded at more than 17,000 on the black market this week, a record low.

Lebanon's government resigned last summer in the wake of an August 4 explosion at Beirut's port that killed more than 200 people.

Yet the country's bitterly divided political leaders have failed to form a new cabinet ever since, despite mounting international pressure led by France.