Lebanon in crisis: Saudi Arabia responds with financial support

Saudi Arabia has provided support to Lebanon to fund urgent development projects amid the country's complex economic and political circumstances, in addition to the repercussions of the conflict with Israel in the south of the region.

As reported by Al Arab, the two sides signed a joint memorandum of cooperation, under which Saudi Arabia will provide 10 million dollars through the King Salman Humanitarian Aid and Relief Centre and the Higher Relief Commission to support development projects in Lebanon. The Saudi ambassador in Beirut, Walid Bukhari, said that some 28 projects will be implemented in various Lebanese regions. 

Although the projects were not specified, Bukhari said during the event, which was attended by Lebanese interim Prime Minister Najib Mikati, that this support comes at the direction of King Salman bin Abdulaziz and his Crown Prince Mohammed bin Salman to support humanitarian work and achieve stability and development in Lebanon.

According to World Bank data, the Lebanese region has been suffering from an economic collapse for five years that has pushed the majority of its population below the poverty line. The economic crisis, exacerbated by external factors such as the pandemic and the war in Ukraine, has pushed inflation to over 170 per cent and severely affected sectors such as construction and infrastructure. 

Mikati expressed hope that Lebanon will recover thanks to Saudi aid, praising the country's interest in Lebanon's stability and development. Saudi Arabia has provided millions in grants, donations and loans over the years, playing a crucial role in the region's economic development.

As a result, Lebanese authorities face major challenges in implementing the necessary reforms while awaiting support from the International Monetary Fund (IMF). In April 2022, an agreement was reached with the IMF for the implementation of economic policies that could unlock USD 3 billion, but it has not yet been implemented due to delays in reforms. 

The EU has also announced a one billion euro financial package for Lebanon, available until 2027, which will contribute to the country's social and economic stability. 

In February, the World Bank approved a $34 million project to restore public financial management and pave the way for sustainable economic recovery. In addition, the Bank also granted 300 million dollars for the Social Safety Net Project to help the most vulnerable populations in the face of the severe crisis situation in the region.

Saudi Arabia's commitment to Lebanon represents a gesture of regional solidarity and a crucial step towards stabilisation and progress in the region. With the implementation of funded development projects, it is hoped that Lebanon will be able to face the current economic and political challenges with renewed hope. This support not only strengthens ties between the two countries, but also augurs well for a more prosperous and secure future for the Lebanese people.