Lebanon’s energy ministry cannot pay for fuel to generate electricity beyond March unless more financing is approved, the caretaker energy minister, Raymond Ghajar, said on Tuesday.
Lebanon, which is reeling from a deep financial crisis triggered by a mountain of debt and decades of corruption, already lacks power generation capacity, so homes and businesses face power outages for several hours each day, forcing many to turn to private generators.
“We are headed towards a difficult situation, if there is no fuel there will be no electricity,” the minister told Reuters.
Ghajar noted that he had asked the president, the caretaker prime minister and head of parliament to approve an emergency loan for the state power company worth 1,500 billion Lebanese pounds ($996 million at the official rate) to buy more fuel.
Earlier this month, he announced that Lebanon usually only kept enough fuel for a few months as it was too costly for the country to hold strategic reserves for 6 months.
Lebanon’s financial meltdown, the biggest crisis since the end of the 1975-1990 civil war, has fuelled unrest, locked depositors out of their accounts and sparked a collapse in the currency, which has lost 80% of its value against the dollar.
Despite that some official transactions are still conducted at the pre-crisis official Lebanese pound rate of 1,500 to the dollar, the currency’s value in the black market has hit more than 9,000.
Prime Minister Hassan Diab and his government, who resigned after a huge blast rocked the Beirut port on Aug. 4, are acting in a caretaker role as fractious politicians have failed to agree on the formation of a new cabinet, leaving Lebanon rudderless.
Given that it is acting in a caretaker capacity, the government cannot hold sessions to approve a budget.