Anti government protests sweep Lebanon amid economic emergency

Updated: Oct 18, 2019, 06:04 PM(IST)

Thousands of people gathered outside the government headquarters in Central Beirut, Lebanon on Thursday evening marking the country's biggest protest. The agitation forced the cabinet to backtrack plans that aimed at raising new tax on WhatsApp voice calls

Government unveils new taxation

The government unveiled a new revenue-raising measure earlier on Thursday, agreeing to a charge of 20 cents a day for calls via voice-over-internet protocol, used by applications including WhatsApp, Facebook calls and FaceTime.

Information Minister Jamal al-Jarrah said ministers would also discuss a proposal to raise the value-added tax by 2 per cent points in 2021 and a further 2 percentage points in 2022 until it reached 15 per cent. The measure was expected to net about $200 million in revenue for the state each year.

But as protests spread across Lebanon, Telecoms Minister Mohamed Choucair told journalists the proposed levy on WhatsApp calls had been revoked.


'The people want to topple the regime'

Protesters blocked roads across Lebanon with burning tyres and security forces fired tear gas at demonstrators in central Beirut early on Friday, Lebanese media said. Dozens of people were wounded, the Red Cross said. Lebanon's internal security forces said 60 police were wounded.

Throughout Thursday night, crowds gathered in the capital Beirut's Riad al-Solh square, some waving Lebanese flags and singing. "The people want to topple the regime," they chanted.

The unrest led Prime Minister Saad al-Hariri to cancel a cabinet meeting due on Friday to discuss the 2020 draft budget. Lebanese media has said he would instead make a speech on the protests.


'Economic emergency'

The protests have been fuelled by stagnant economic conditions exacerbated by a financial crisis in one of the world's most heavily indebted states.

The government, which has declared a state of "economic emergency", is seeking ways to narrow its gaping deficit.

Lebanon faces high debt, stagnant growth, crumbling infrastructure and reduced capital inflows. The Lebanese pound, pegged against the dollar for two decades, has been under pressure.


Protests signify deepening anger

In a country fractured along sectarian lines, the unusually wide geographic reach of these protests has been seen as a sign of deepening anger with politicians who have jointly led Lebanon into crisis.

The anti-government protests in a country mired in economic crisis entered their second day on Friday.

The government, which includes nearly all of Lebanon's main parties, is struggling to implement long-delayed reforms that are seen as more vital than ever to begin resolving the crisis.


One of the highest debt burdens

Shattered by war between 1975 and 1990, Lebanon has one of the world's highest debt burdens as a share of its economy. Economic growth has been hit by regional conflict and instability. Unemployment among those aged under 35 runs at 37 per cent.

The kind of steps needed to fix the national finances have long proven elusive. Sectarian politicians, many of them civil war veterans, have long used state resources for their own political benefit and are reluctant to cede prerogatives.


Government yet to convince foreign donors

The crisis has been compounded by a slowdown in capital flows to Lebanon, which has long depended on remittances from its diaspora to meet financing needs, including the state's deficit.

The financial crunch has added to the impetus for reform but the government's steps have yet to convince foreign donors who have offered billions in financial assistance conditional on changes.

The strains have emerged recently in the real economy where importers have been unable to secure dollars at the pegged exchange rate.


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