“Tug of war between Germany and France to lead the reconstruction of the port of Beirut” | Financial

A gigantic chemical explosion last August killed 200 people, injured thousands and devastated entire neighborhoods of the Lebanese capital. The catastrophe further troubled the country, which was already suffering from the deepest political and economic crisis since the civil war of 1975-1990.

According to two diplomatic sources, Germany and France are fighting for control of reconstruction plans. Berlin will explain its proposal on April 7, which diplomats say would in principle benefit from the support of the European Investment Bank (EIB). EIB financing could be between 2 and 3 billion euros.

The German ambassador to Lebanon confirmed that a proposal would be made next week for the redevelopment of the port of Beirut and neighboring areas. The plan has been prepared by several private companies, which will explain it to Beirut.

Lenders

But first, the Lebanese political elite must agree on the composition of a new government to put public finances in order and fight corruption. It is a condition that lenders, including the International Monetary Fund, ask before releasing billions of dollars in aid.

Eight months after the port disaster, many Lebanese who lost families, homes and businesses are still awaiting the results of an investigation into the causes of the explosion. Lebanon is on the verge of collapse. Buyers are fighting over goods, protesters block roads and businesses are closed.

Foreign lenders have said the new government must have a strong mandate to implement economic reforms. Then, in addition to a central bank audit, it is also an overhaul of the waste energy sector. Germany and France would first like to see a government committed to reform. That would be the only way, which is also good for Lebanon, according to insiders.