by Dana Halawi
BEIRUT, April 2 (Xinhua) -- Lebanese economists are calling upon government to take urgent reforms in the 2019 state budget in a bid to save the country's economy from further deterioration.
"The government can surely cut a lot of expenditures in the 2019 budget," Nassib Ghobril, head of the economic research department at Byblos Bank, told Xinhua.
Ghobril said that the government can, as a start, stop the bonuses that are paid to public sector employees.
Ghobril added that employment in the public sector has not stopped yet while the sector already has an excess number of employees.
The expert said that the public sector salaries and retirement salaries and benefits constitute 38 percent of the government's expenditures, the biggest burden on the state budget.
The international community has been calling upon Lebanese officials to implement urgent and necessary structural reforms in a bid to be able to access funds and donations pledged for Lebanon at CEDRE conference.
Moreover, Ferid Belhaj, vice president for the Middle East and North Africa at the World Bank Group, warned last Friday that the reforms that Lebanon has started are still not enough and a lot more should be done to have access to funds from the international community.
The main reforms, according to the international community, should include the preparation of the 2019 state budget with a reduction in the deficit-to-GDP ratio of five percent over five years in addition to reforms in the electricity sector by creating a sustainable solution to the power crisis.
Finance Minister Ali Hassan Khalil is expected to send the draft budget to the council of minister soon which will study it and then send it to the parliament for voting by the end of May.
Lebanese officials and namely Prime Minister Saad Hariri have on many occasions hinted at the fact that the wage increase approved by President Michel Aoun in 2017 for public sector employees has exacerbated the burden on the state budget while adding that the new government will take very hard decisions when it comes to reforms and everybody should share the burden of the new state budget.
Head of the General Labor Union Bechara Asmar expressed his fears over Hariri's announcements saying that he will not accept any changes in the salary scale and people will take it to the streets if the wage increases approved by President Aoun for public sector employees are removed.
While Ghobril assured that the salary scale cannot be removed as it was approved with a law, he said that the government should start immediately to explore a sustainable solution to the electricity problem.
"The government needs to address the power problem in a sustainable way which would allow the private sector to produce electricity and that would upgrade the network and lead to significant improvement in fee collection," Ghobril said.
