By Dominic Evans
BEIRUT – The European Union’s foreign policy chief told Lebanese leaders on Saturday that they were to blame for the country’s political and economic crisis and that some could face sanctions if they continued to hamper measures aimed at form a new government and implement reforms.
Speaking after what he called a “frank exchange” with President Michel Aoun, Josep Borrell said he brought a firm message that the country was on the verge of financial collapse and that politicians could not not afford to waste any more time.
“The crisis facing Lebanon is an internal crisis. It’s a self-imposed crisis, ”he told reporters after talks with Aoun.
“It is not a crisis coming from abroad or from external factors. It is a homemade crisis, a crisis made by yourselves.
The Lebanese currency has lost 90% of its value. More than half of the population lives in poverty and grapples with soaring inflation, blackouts, and shortages of fuel and food.
The crisis has been exacerbated by the political stalemate, with Prime Minister designate Saad al-Hariri at odds with Aoun for months on forming a new government capable of introducing reforms that could unlock desperately needed foreign aid.
“We are ready to help,” Borrell said. “But if there are more obstacles to solutions to the current multidimensional crisis in the country, we will have to consider other action plans as some member states have proposed.”
“The Council of the European Union has included other options, including targeted sanctions.”
The possible sanctions are part of an effort by some EU states, led by France, to step up pressure on unruly politicians in Lebanon after nearly a year of lockdown.
An EU diplomatic note viewed by Reuters showed that the criteria for sanctions under preparation are likely corruption, obstructing efforts to form a government, financial mismanagement and human rights violations.
The bloc has yet to decide which approach to take. Borrell will report to foreign ministers on Monday after his talks in Beirut, where he is also due to meet with Hariri, the speaker of parliament and the acting prime minister.
Paris says he has already taken steps to restrict the entry of some Lebanese officials he sees as blocking efforts to tackle the crisis, which is rooted in decades of corruption and state debt. , although he did not name anyone publicly.
As politicians bicker, funds still bleed from the country’s central bank to support a fuel and food subsidy program that costs $ 6 billion a year and ministers say Lebanon can no longer afford .
Foreign exchange reserves have halved in less than two years, and the bank on Wednesday urged the interim government to approve a plan to ration subsidies and target those most in need.
Borrell said the country must form a new government, agree on a reform program and achieve a IMF loan agreement. Once this deal was concluded, the European Union was ready to consider providing “significant sums” in the form of loans and assistance.
“Lebanon needs an agreement with the IMF and there is no time to waste, ”he said. “You are on the verge of financial collapse.”