Forming New Lebanese Government Will Draw Foreign Aid, Central Bank Says

Newly elected Lebanese president Michel Aoun sits on the president's chair inside the presidential palace in Baabda, near Beirut, Lebanon. REUTERS/Aziz Taher

BEIRUT, Nov 3  – Lebanon’s election of a new president and the coming formation of a government will increase confidence in the economy and attract foreign aid, the head of the country’s central bank said on Thursday.

The Lebanese parliament elected former army commander Michel Aoun as president on Monday, ending a 29-month presidential vacuum. Sunni leader Saad al-Hariri is expected to named as prime minister later on Thursday, but it is unclear how quickly he will be able to form a government.

“The election of President Aoun should lead to a normal activity of the constitutional institutions … thus increasing confidence in the economy,” Riad Salameh said at an international conference organised by the central bank in Beirut.

“The formation of a new government would help by attracting foreign aid and mitigating the cost of the Syrian presence in Lebanon that we estimate at 5 percent of the GDP,” he added, referring to the large Syrian refugee population.

Lebanon is sheltering more than 1 million Syrians who have fled the civil war next door.

Political deadlock, including the presidential vacuum, paralysed state institutions and prevented the government from taking even basic decisions.

Lebanese are desperate for better government to deal with problems in the economy, infrastructure and basic services. The stalemate came to a head last year when garbage piled up in the streets, creating a public health crisis.

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