As one of world’s most indebted economies, Lebanon is in desperate need of financial help in order move major development projects forward.
This week, Lebanon received a significant showing of support from the international community. At a conference in Paris, the Mediterranean nation managed to raise just over $11 billion in loans and grants from Western and Arab nations, France 24 reported.
The aid is contingent on Lebanon pushing forward policies that make its government and economy run more efficiently. Projects to be funded by the loans and grants include waste-water plants, transportation infrastructure and power-grid upgrades.
"Today Lebanon has forged a new partnership with the international community. A partnership to safeguard its stability, and for growth and job creation."
Lebanese Prime Minister Saad Hariri vowed to ensure the funds are used for serious action.
“This isn’t a conference that ends today, it’s a process that starts today to modernize our country,” Hariri said at the end of the one-day meeting.
“We are determined to advance and put it into action.”
Delegates at the event pledged $10.2 billion in loans and $860 million in grants for the first four years of a seven year reform plan. According to Lebanese officials, the country estimates it needs about $10 billion for the first phase of the plan, and $17 billion in total.
French President Emmanuel Macron voiced his country's strong solidarity with Lebanon, praising the international community's "unprecedented mobilization" in support of the Mediterranean nation.
"At a time when the Levant probably lives one of the worst moments of its history ... it's more important than ever to preserve the most precious asset: a peaceful, diverse and harmonious Lebanon," Macron said, according to ABC News.
Lebanon's national debt hovers around $80 billion, which is about 150 percent of the nation's gross domestic product.
Although the international community has shown its support for maintaining Lebanon's economic stability, there are still concerns about how the country will use the money.
“It’s about whether the money will go into the right places and that Lebanon can pay for its debt,” Ayham Kamel, head of Middle East and North Africa research at Eurasia Group, told Bloomberg. “Otherwise, we’re just switching high-interest debt with low-interest debt and that doesn’t do anything.”
But the World Bank expressed great confidence in Lebanon's potential and its government.
"The reason we are confident is because the government over the last month has shown determination that we have not seen in past years. They have passed very important laws. They are pursuing procurement reform and they are putting forward an anti-corruption law with a strong backing from the people of Lebanon" World Bank Chief Executive Officer Kristalina Georgieva said.
Rampant corruption, regional unrest and the aftermath of the nation's 15-year civil war – which ended in 1990 – have taken a major toll on Lebanon's economy.
Residents of Lebanon have suffered from daily power cuts and routine water shortages for years, with successive governments continually promising to address the problem and failing to do so.
The Syrian civil war, which has seen Lebanon host between 1.2 and 2 million refugees, has also taken its toll on the nation's already inadequate infrastructure.
"If Lebanon does not pursue a comprehensive reform plan then the outlook – not immediately, but beyond 2020 – turns quite dim," Kamel pointed out.
Later this month, on April 25, Lebanon has a conference planned in Brussels aiming to shore up international support to help the country deal with the ongoing refugee crisis.