Billions pledged in aid to Lebanon

Donors offer more than $7bn as Lebanese prime minister warns of recession.

    Jacques Chirac, left, told the Paris conference that Lebanon needed generous support [AFP]

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    Deaths in Lebanon clashes

    As the donors met in Paris, rival Lebanese students clashed at the Beirut's al-Arabiya University, reportedly leaving four students dead and many wounded.
    Chirac had earlier opened the one-day conference saying Lebanon needed generous support to overcome its economic problems after the "appalling clashes" last year.
    Support needed

    "[Lebanon] is a country that is obstinately seeking rebirth and more than ever needs the unanimous support of the international community," Chirac said.

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    "Even with the entire world on his side, Siniora will lose if he hasn't got the Lebanese on his side"

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    The World Bank and the European Investment Bank announced more than $2bn in aid and Saudi Arabia said it would give $1.1bn.

    The United States, France and the European Union had already offered aid and loans worth some $1.92bn, but French diplomats had been worried other countries might hold back because of the current political turmoil in Lebanon.

    The Islamic Development Fund has pledged $250m and the Arab Fund for Economic and Social Development $700m, while Margaret Beckett, the British foreign secretary, said London would offer about $48m in aid, primarily for refugees.


    High-ranking representatives of more than 40 countries and organisations were attending the meeting, including Condoleezza Rice, the US secretary of state and Ban Ki-moon, the UN secretary general.




    The war in July and August last year between Israel and Hezbollah seriously exacerbated Lebanon's problems, leaving much of the country's infrastructure bombed and many Shia villages and districts wrecked.

    Lebanon's debt is equal to 180 per cent of its gross domestic product.


    Siniora said that his government would stand firm against opposition protests and try to enact planned financial reforms that would see a rise in  value-added tax from 2008 and increased privatisation of state-owned assets.


    "The cost of failure is too great to contemplate, certainly greater than the cost of implementing success," he said.


    The meeting comes two days after some of the worst street violence Lebanon has seen in years, with six people killed and more than 100 injured during a general strike called by the Hezbollah-led opposition.


    Opposition accusations

    Hezbollah has accused Siniora of being in the pocket of the West and Lebanon's pro-opposition al-Akhbar daily newspaper said on Thursday the Paris conference was designed to help the government, not the country.


    Siniora said at the conference that his government would continue to reach out to opposition groups.


    "Lebanon has learned the hard way that peaceful dialogue is the only way to resolve political difference," he said.


    Some donors are likely to link their aid offers to Siniora's ability to push through his potentially unpopular reform package, which was unveiled this month and includes plans for privatisations, cutting state spending and hiking taxes.


    Ban, speaking at the conference, said: "Success of the conference is measured not only in amount of donation, but also in implementation of reforms."

    SOURCE: Al Jazeera and agencies


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