PARIS, Jan 25 (KUNA) -- In what is being termed a resounding success, and a strong statement of support for Prime Minister Fuad Al-Siniora, the Paris III conference awarded Thursday USD 7.63 billion to help rebuild and restructure the Lebanese economy in the wake of the Israeli devastation of that country last summer.
At the end of the mornings public session of the one-day conference, President Jacques Chirac, who was the key instigator of the event, proudly announced the colossal figure to loud applause from the almost 40 participants, among them States, financial funds and international organizations.
Participants are meeting in closed session for the rest of the day.
The USD 7.63 billion will take the form of grants, soft loans and project financing and it is contingent on Lebanon implementing a tough reform plan that will include restructuring of the countrys USD 41 billion debt and the revamping of the financial sector.
Lebanon will be called upon to privatize certain sectors and to reform its fiscal system, in addition to carrying out a social modernization plan and carrying out budgetary restrictions.
Most participants praised the Lebanese reform plan as presented by Al-Siniora, but sources told KUNA that money would not be handed out all at once and would be given in " tranches," or segments, according to the progress of reforms.
Nonetheless, the results of Paris III, the third such conference to re-float the Lebanese economy, held in the French capital, are seen as beyond initial expectations which hoped that between USD 5.0 billion and USD 7.0 billion would be raised Thursday.
In the Paris II conference at the end of 2004, just over USD 4.0 was pledged for Lebanon, but the results on the ground in that country were not satisfactory due to institutional problems and other internal obstacles. There were also questions on misuse of the funds from Paris II and participants in Paris III said that there were better safeguards for transparency and vigilance now.
Major donors Thursday included Saudi Arabia, with around USD 1.1 billion, the European Investment Bank, 1.25 billion, the United States, USD 770 million, the Arab Fund for Economic and Social Development, USD 700 million, France, USD 650 million, the European Union USD 515 million, among other contributors.
Most of the financing is for short and medium-term periods and while it was not blatantly made conditional on political stability in Lebanon, several participants hinted this would be requirement if financial flows are to continue in the future.
Kuwait pledged to continue its ongoing support for Lebanon through aid already being processed through the Kuwait Fund for Arab Economic Development (KFAED).
Already after the Israeli aggression against Lebanon last July-August, Kuwait gave the Lebanese central bank USD 500 million to stabilize the Lebanese pound and also pledged USD 300 million in aid, in additional to aid flows from Kuwaiti NGOs and the Kuwaiti Red Crescent.
Kuwait was represented at Paris III by Finance Minister Bader Mishari Al-Humaidhi, and Abdulwahab Al-Bader was there on behalf of the KFAED of which he is Director-General.
