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Lebanon’s freshly-installed cabinet ( MEES, 1 February ) says it will cut electricity subsidies by some $600mn this year. Prime Minister Saad Hariri says the key aim is to cut a budget deficit which topped $3bn for the first half of 2018 alone ( MEES, 21 December 2018 ) and in doing so unlock part of the $12bn in aid pledged t last year’s CEDRE donor’s conference ( MEES, 13 April 2018 ).
If the country’s patronage-heavy ruling class can indeed manage to reduce electricity subsidies, it would have two positive effects. One, it would greatly reduce the deficit, 10-20% of which consists of ‘transfers’ to the state electricity company Electricité du Liban. The government forked out over $740mn in 1H 2018 alone on such payments, and $1.33bn in 2017. (CONTINUED - 188 WORDS)