The International Monetary Fund (IMF) has allocated $250 million to assist Lebanon and sent a delegation to Beirut to ensure that the administration is adhering to terms for further and broader financial aid. The IMF officials conducted discussions during their visit with local decision-makers on a proposed financial reform program aimed at boosting growth and supporting low-income segments ahead of the anticipated bailout deal. Prime Minister Nawaf Salam described the talks with the IMF mission as “responsible and realistic,” affirming his confidence in the international fund to restore financial stability and monitor structural reforms within the Lebanese administration.
Minister of Finance Yassin Jaber stated that negotiations with the IMF have progressed positively, revealing that fund officials during their visit confirmed “tangible progress regarding the financial regulations and the aspired reforms,” according to a report by Kuwait News Agency (KUNA). However, he expressed concerns about the impact of regional “security developments” on the country.
Minister Jaber noted that his department has “accomplished plenty of reform steps,” including the enactment of the banking confidentiality law (endorsed by parliament) and the drafting of the banks regulation law, which has been submitted by the government for legislative review prior to final endorsement. Addressing a significant challenge, Minister Jaber acknowledged that the proposed “financial vacuum law” (compensating banks’ depositors) remains among the required reforms, indicating that the issue would be revisited once deputies of the Central Bank Governors have been assigned.
He expressed optimism that positive outcomes in this regard would ultimately be achieved due to the commitment of the president, the parliament speaker, and the government to advance with the necessary reforms “not because this is an international demand but because it is an internal requirement.”
Beirut aims for $3 billion despite $8 billion need
Lamyaa Al-Mubayyed, chairperson of the Basil Fleihan Institute for Economy and Finance and a member of the Lebanese delegation engaged in talks with the IMF, stated in a report to KUNA that the IMF grants soft loans to member states based on their contributions to the fund. Consequently, Beirut aims to secure only $3 billion, despite estimated needs of around $8 billion due to heavy losses from the recent war. “We will be compelled to seek aid from donors,” Al-Mubayyed emphasized, noting that the IMF requires tangible financial and administrative reforms before providing a bailout, adding that the fund’s stance is “technical and not political.”
Antoine Farah, head of the economy department at the local daily newspaper “Al-Jumhouriya,” pointed out that the central theme of the discussions with the IMF revolves around formulating a funding program, affirming that the pace of negotiations with the fund has been slow. He indicated that parliament has approved the banking confidentiality law, a key condition set by the IMF, along with the bill for banking reforms. However, the most significant bill for the reforms is “the financial vacuum law,” related to the affected depositors who lost their funds in banks as the national currency’s value plummeted to about 90,000 pounds per single U.S. dollar.
Read more: What is the IMF’s perspective on Egypt, Tunisia, and Lebanon?
Possible delay until parliamentary elections
Farah believes that this issue may be postponed until after the parliamentary elections scheduled for next spring and noted that it will be addressed during a planned visit by an IMF delegation to the country in September. Finance Minister Yassin Jaber expressed confidence that the banking regulation law would be approved by parliament before the end of this month.
Former Minister of Economy Alaine Hakim stated that the Lebanese economy cannot recover without financial support from the Gulf Cooperation Council (GCC) countries. He also highlighted that attracting external investments is crucial for revitalizing the struggling economy, stressing that drawing in entrepreneurs necessitates stable security conditions and restricting arms possession to state authority.
The IMF has recently announced the approval of $250 million for Lebanon for emergency reconstruction and revealed in a statement that the country requires $11 billion to cover some losses stemming from the conflict between October 8, 2023, and December 20, 2024. The Lebanese financial crisis has intensified since 2019, with the national currency losing more than 90 percent of its value and the domestic product shrinking by 60 percent.
Parliament passes banking secrecy amendments
In April 2025, Lebanon’s parliament passed significant amendments to its banking secrecy law, marking a vital step in the country’s efforts to recover from a severe economic crisis that began in 2019. This reform, which allows authorized entities greater access to banking records from the past decade, was a key demand from the IMF as Lebanon seeks to stabilize its economy and unlock much-needed financial aid.
The amendments grant regulatory bodies, including independent auditors and the central bank, the authority to access banking information without needing to specify a particular objective. This change is expected to enhance transparency and accountability within the banking sector.
The law applies retroactively for ten years, meaning it can cover transactions and accounts dating back to the onset of the economic crisis. This provision aims to facilitate investigations into past financial misconduct and corruption.
The law was passed with substantial support, receiving 87 votes in the 128-seat parliament. This reflects a growing consensus on the need for reform among Lebanese lawmakers.
Prime Minister Nawaf Salam emphasized that this reform is essential for restoring depositor rights and rebuilding trust among citizens and international stakeholders. He noted that the previous culture of financial opacity had become a liability rather than an asset for investment.
Economic turmoil since 2019
Lebanon’s economy has been in turmoil since 2019, largely due to years of mismanagement and corruption by the ruling elite. The financial collapse has left many citizens unable to access their savings, leading to widespread poverty and social unrest. The IMF has been in discussions with Lebanon since 2022 regarding a funding program, but progress has been slow due to the government’s failure to implement necessary reforms. The recent amendments are part of a broader strategy to tackle the financial crisis, which includes plans for restructuring the banking sector and addressing the significant financial gap that has emerged. Finance Minister Yassin Jaber, currently in Washington for meetings with the IMF and World Bank, expressed optimism that these reforms would facilitate ongoing negotiations for financial assistance.
