Frem: To achieve financial balance, otherwise the continuous and renewed collapse will have the effect of a nuclear bomb

Lebanese MP Neemat Frem declared that “the budget that is about to be discussed is a far cry from the reality of the biggest collapse we are currently witnessing in Lebanon, while it was supposed to be the first step towards financial recovery."

He added: "I had hoped that this budget would carry the lessons we learned from the collapse we lived. But in the last two years, we have only seen solutions that look like a ‘shocked man blinded by the light’ and unable to move, neither to the right nor to the left. We have recommended in 2019, via the Parliamentary committee for national economy, the adoption of five-year economic plans, because our numerous problems cannot be addressed within twelve months and require several years. This budget was supposed to convey the first set of solutions within a long-term plan, but we did not see such measures.”

 

In his intervention during the budget discussion session in the parliament, deputy Neemat Frem said: “The situation we have reached is the result of three reasons and methods that have been practiced over 15 years. The first reason is accepting the budget deficits without lifting a finger, and deficits are a fatal disease. The second one is accepting an

unproductive economy that creates fake and unsustainable job opportunities. The third reason is the lack of boldness in taking unpopular decisions; thus, the cost of production was much higher than the prices in the electricity, energy and communications sector. We have taught a whole generation to unconsciously spend more than what they produce.

The adoption of a financial balance as a basis for increasing the state revenues is required to cover the expenses. It is true that this matter may be more painful for the citizen, but the solution in return will consist of supporting the components of resilience through social protection and the immediate issuance of a health card, whose cost will not exceed the 300 dollars per citizen nationwide.”

 

Frem then wondered how “a country that needed $17 billion to function in the past years, would be able to work with a mere billion dollars in the 2022 budget? This means that the deficit the budget is showing today is incorrect and that the real number will be doubled. Our greatest fear is that this deficit will be compensated by the remaining deposits in the Central Bank, what we firmly reject.”

 

He added: "I wish I have clearly seen one single customs dollar rate in this budget, in order to protect national production and encourage industry and agriculture. These two sectors are the promising ones that will help Lebanon recover after the collapse; they need a strong customs protection, hence the necessity to their direct link to a percentage that may reach 50 percent between the rate of Sayrafa platform and the customs dollar. The customs dollar revenues are enough to cover the salaries of the public sector; however, you are talking in this budget about increasing the salaries three times, when any increase that is inferior to 16 times will not raise the standard of living of civil servants and will not make any difference because inflation has multiplied by more than 20.”

 

Frem concluded: “We need a political decision based on achieving the principle of financial balance in the various state institutions. This way, we could say that we have learned from the past to start the path of ending the deficit... Otherwise, we will be preparing a nuclear bomb, similar to the one that wrecked our economy because of the deficit. We are a generation who stole their children and grandchildren when living the luxury of a dollar rate at 1500 LBP; we didn’t even motivate them to work and produce.  And now, with this great collapse, it is time for the budget to be the right economic model for future generations, a model based on the culture of production, work and refusal to spend more than what is produced.”

 

 

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