Lebanon is undergoing an unprecedented financial and economic deterioration as the middle class is gradually disappearing, basic needs are becoming increasingly scarce, the unemployment rate is soaring, and brain drain is out of control. People are being pushed to extreme poverty lines. The grievances and sense of insecurity are surging to the peak where the state is trapped with no concrete road map to exit from complex crises.
The Lebanese Economic and Social Council (ECOSOC) submitted a paper on “redirecting subsidies” based on a participative approach process with relevant stakeholders. The paper introduced a series of recommended urgent measures to be implemented for 12 months to remove subsidies gradually on most commodities within a holistic program for rescue, reform and recovery, in conjunction with activating work with direct cash assistance in dollars via a cash card, taking into consideration the increase in their value in parallel with the subsidy lifting process. The paper highlighted the importance of merging all direct cash assistance programs under one centralized governmental mechanism that puts clear and unified selection criteria and sets a National Social Registry.
The Lebanese government launched in 2011 the National Poverty Targeting Program (NPTP) with assistance from the World Bank to help households living below the extreme poverty line. Building on NPTP, the government launched the Emergency Crisis and COVID19 Response Social Safety Net Program (ESSN) to support the poor and vulnerable who are severely affected by the implications of COVID-19 and economic crises. The program is financed through a loan from the world bank of total amount 246 million USD. The components of the program will be: (i) cash transfers to 140,000 extreme poor Lebanese households; (ii) top-up cash transfers for students from extreme poor Lebanese households at risk of dropping out of school; (iii) social care services to vulnerable Lebanese households and Displaced Syrians; (iv) enhanced delivery of Social Safety Net systems. According to the Implementation Status & Results Report that was published by the World Bank on April 19, “the parliament introduced changes to the Project Loan Agreement, and the World Bank is awaiting a letter from the Minister of Finance to review the Parliament’s latest changes, which will likely require additional time and funds. Most importantly, the government should have started the verification of applicants – one of the disbursement conditions – as this process is expected to take 4-6 months at minimum.” Thus, the project implementation is delayed and there is no clear declaration on the currency negotiations as beneficiaries will receive the cash assistance in the Lebanese Pound.