A British Treasury minister has said the International Monetary Fund “must establish safeguards” to stop money sent to Lebanon going to Hezbollah.
Economic Secretary to the Treasury John Glen MP made the comments in response to a parliamentary question tabled by fellow Conservative John Howell, who asked about the “risks of misuse” of IMF loan packages to the crisis-hit country.
Lebanon’s cash-strapped government is desperately seeking financial aid as its economy reels, with the currency having lost 80 percent of its value in recent months, and the IMF is one of few possible lifelines, alongside Chinese investment.
Prime Minister Hassan Diab’s government is supported by the Iran-backed Hezbollah and its allies, prompting Howell to ask about lending conditions relating to the Shi’ite militia.
“The IMF must establish adequate safeguards for use of its resources, consulting and updating the board of directors, as its policy develops,” said Glen.
“Safeguards can include strengthening auditing or procurement rules, and wider Central Bank reform. The UK uses its seat on the IMF board… to help ensure that programme conditions are consistent with the IMF’s mandate.”
He added that there had been “no formal discussions” at the IMF board on Lebanon, though the IMF said recently that “there is significant scope to strengthen the transparency and accountability of economic policies, and public sector entities”.