Lebanon's new prime minister vows reforms, but Lebanese people aren't convinced

Anti-government protesters take part in a demonstration against the political elites and the government, in Beirut, Lebanon, on August 8, 2020 after the massive explosion at the Port of Beirut.

STR | NurPhoto via Getty Images

Lebanon's political leaders named diplomat Mustafa Adib as the disaster-stricken country's new prime minister on Monday, starting the formation of a new government tasked with implementing urgent reforms after the previous leadership quit en masse.

But for many Lebanese citizens, hundreds of thousands of whom saw their homes destroyed in the devastating August 4 blast at Beirut's port, the personnel changes at the top of government are merely a facade. 

"He's the new mask of the system," Yumna Fawaz, a local journalist in Beirut, told CNBC. 

Sara El Dallal, a Lebanese marketing manager who spent weeks volunteering with humanitarian aid groups after the explosion, described Adib visiting a damaged Beirut suburb shortly after his appointment. She recalled him being "kicked out" by angry residents.  

"He will not make a difference," she said. "He is another face of the same political regime." 

The Mediterranean country of nearly 7 million has for years failed to enact political and economic reforms to manage its crippling debt, clean up its banking sector and tackle entrenched corruption by political elites — corruption enabled in part by Lebanon's complex sectarian governing system.  

A before (L) and after satellite image after a massive explosion in Beirut, Lebanon.

Source: Planet Labs

 "God willing, we will agree to have a ministerial team of competent specialists and hit the ground running to implement essential reforms swiftly, to put the country on the road to recovery," Adib said in a speech after his appointment. But the Lebanese public has heard these promises before.

They know that their governments, however well-intentioned, cannot operate without interference from the country's banking and political lobbyists and parties. 

Inheriting a disaster

As the country approaches hyperinflation, the UN has warned that over half of its population is living in poverty with 23% in "extreme poverty" — while 10% of the population owns 70% of its wealth. Unemployment was at 40% even before the coronavirus pandemic and explosion hit, and the country is struggling to import food and medical supplies. 

Adib, who served as Lebanon's ambassador to Germany for the last seven years, is the second Lebanese prime minister to be appointed in eight months, after technocrat Hassan Diab resigned following the Beirut blast and longtime political figure Saad Hariri stepped down in October amid nationwide anti-government protests. 

So while Diab was tasked with pulling Lebanon out of its financial crisis — a failure the ex-prime minister attributed to the "long-ruling class whose corruption has asphyxiated the country" — Adib is facing a country even deeper in crisis with a capital city in tatters. 

"Adib will not come with miracles and much will depend on the figures that will participate in his government," political risk consultancy Eurasia Group wrote in a note Tuesday. But, it added, there seems to be "willingness to allow Adib to appoint individuals with credible expertise in government," suggesting space for compromise and a new government that would be "mildly positive for political and economic stability."  

A woman hold a banner shows the name of victims of Beirut Explosion during a protest near the port, on August 11, 2020 in Beirut, Lebanon. Last week's explosion, which killed more than 200 people and injured thousands more, is seen by many Lebanese as a deadly manifestation of government malpractice.

STR | NurPhoto via Getty Images

"The designation in no way guarantees the successful formation of a new government, but the balance of forces is in Adib's favor," Eurasia wrote. 

The formation of government is often a long and tortuous process with each sect sparring over their representation.  

Adib, like his predecessor, was appointed with the endorsement of Sunni political leaders, the Christian Free Patriotic Movement (FPM) and Shiite groups Amal and Hezbollah. Hezbollah, backed by Iran and designated by the U.S. as a terrorist organization, is the most powerful political party and militant group in Lebanon. The relatively quick decision came after threats of sanctions by international leaders.   

Some critics have pointed out that Adib for years served as an advisor to multibillionaire ex-prime minister Najib Mikati, Lebanon's richest man, who was indicted on financial corruption charges last year.  

Asked by a protester on Tuesday if his new government would bar discredited politicians, he replied: "God willing."  

Macron threatens sanctions

French President Emmanuel Macron touched down in Beirut shortly after Adib's appointment, his second visit to the former French protectorate since the port explosion that killed nearly 200 people and left an estimated $4.6 billion in damages. 

Macron warned that if real reforms don't happen, including in the banking sector and at the central bank, France could impose punitive sanctions on the ruling class. 

But Macron's efforts — what he's called "the last chance for this system" — could still fail, many Lebanese believe. 

"What Macron is asking of Lebanon's political leaders is nothing short of suicide," Bachar El-Halabi, a Lebanese MENA analyst for ClipperData, wrote on Twitter on Monday. "For them to change their very DNA, the way politics & government have been run in the country for 3 decades, & from which the leaders have drawn great personal profit."

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