U.S. Plans Intervention in Lebanon’s Central Bank Governor Selection

The United States is set to intervene in the selection of Lebanon’s new Central Bank Governor to address corruption and limit Hezbollah’s influence. This involvement emphasizes the U.S.’s focus on Lebanon’s financial recovery amid a severe economic crisis. The new governor will play a crucial role in implementing necessary economic reforms as the government seeks international aid while excluding candidates associated with corruption or Hezbollah.

The United States plans to involve itself in the selection of the new Governor of Lebanon’s Central Bank to mitigate corruption and deter the financing of Hezbollah through the banking system. This action underscores Washington’s heightened engagement in Lebanese affairs amidst a significant financial crisis that has persisted for over five years, contributing to the country’s economic collapse.

This U.S. intervention is indicative of its ongoing effort to reduce Hezbollah’s influence, which has been weakened in the government following Israeli military actions last year. The election of Joseph Aoun, a candidate endorsed by the U.S., as the President of Lebanon solidified this shift, with a new government devoid of direct Hezbollah representation now needing to appoint a Central Bank Governor, currently overseen by an interim governor since July 2023.

American officials are evaluating various candidates for the governor position, as reported by three Lebanese sources, a Western diplomat, and a U.S. official from the Trump administration. These officials have conducted meetings with potential nominees in Washington and at the U.S. Embassy in Beirut to discuss combatting terrorism financing and willingness to confront Hezbollah.

While the U.S. State Department and Lebanese officials have refrained from commenting on the U.S. involvement, a previously unnamed official described the selection process as adhering to specific criteria: exclusion of candidates linked to Hezbollah or corruption. This approach is deemed essential for Lebanon’s economic recovery amidst the financial turmoil triggered by rampant corruption and fiscal irresponsibility within the ruling elite.

Several candidates have emerged for the pivotal role of Central Bank Governor, including former minister Camille Abu Suleiman, Firas Abi Nassif from an investment firm, International Monetary Fund’s Jihad Azour, and asset managers Philippe Jibran and Karim Sweid. The new governor’s responsibilities will be crucial for implementing economic reforms essential for Lebanon’s recovery from its continuing crisis, which began in 2019.

The Lebanese government aims to renew discussions with the International Monetary Fund over a financial aid program, although actual economic reform is foundational for any potential assistance. Furthermore, any external aid for reconstruction from Western and Arab nations hinges on the successful enactment of these reforms, particularly following the damages inflicted by last year’s Israeli military campaign.

The next governor will succeed Wassim Mansouri, who has been temporarily handling the Central Bank since the controversial departure of Riad Salameh after 30 years in office. Salameh’s time as governor is marred by charges of corruption and his role in the disastrous collapse of Lebanon’s financial system, which also resulted in Lebanon being placed on the Financial Action Task Force’s grey list due to its inadequate measures against money laundering and terrorism financing.

In summary, the U.S. is poised to play a significant role in determining Lebanon’s new Central Bank Governor, with an emphasis on reducing corruption and thwarting Hezbollah’s influence. The selected candidate will be vital for steering economic reforms necessary for Lebanon’s recovery from its prolonged financial crisis, which remains contingent upon international support and adherence to specified reform protocols. The political ramifications of this intervention underscore a strategic realignment in Lebanon’s governance in the wake of significant economic challenges.

Original Source: www.jordannews.jo