The data released by the Ministry of Finance (MoF) recently indicated that Lebanon’s gross public debt hit $101.64B in July 2022, thereby recording an annual increase of 3.5% YOY.
The rise is mainly attributed to the annual increase in both local and foreign currency debt by 1.19% and 7.27%, respectively. In details, debt in local currency (denominated in LBP) stood at $61.43B in July 2022. As such, domestic debt constituted 60.44% of the total public debt.
Meanwhile, total debt denominated in foreign currency (namely in USD) reached $40.21B over the same period. In turn, total foreign debt grasped a stake of 39.56% of the total public debt by July 2022. It is worth mentioning that $11.47B represents the unpaid Eurobonds, their coupons and accrued interests, due to the default on government Eurobonds in March 2020.
Looking at net domestic debt, which excludes public sector deposits with the central bank and commercial banks, it decreased by 3.55% YOY to $47.24B in July 2022. As a result, the public deposits are estimated at $14.19B, amassed to cover increasing social assistance payments to public employees.
Lebanon is facing a power vacuum following the end of term of Michel Aoun’s presidency. In fact, after multiple voting sessions, Lebanon’s parliament still has not elected a new Head of State, despite the urgent need of a fully empowered cabinet that will follow up with IMF conditions including the restructuring of external public debt.
Domestic and Foreign Debt by July 2022 ($B)
Source: MoF, BLOMINVEST Bank