Lebanon set for new government amid nationwide uprising

Hind Al Soulia - Riyadh - Lebanese Prime Minister designate Hassan Diab and Speaker of Parliament Nabih Berri headed to the presidential palace on Tuesday night as the country’s new government was set to be announced.

A deal between Hezbollah and its allies paved the way for Mr Diab's administration, ending a political crisis amid months of mass nationwide protests.

Caretaker Finance Minister Ali Hassan Khalil of the Amal Movement said on Tuesday evening that a new government was "hours away".

Sources reported that Mr Diab was set to announce a 20 member administration and that Ghazi Wazni, an economist who has served previously as a financial adviser to parliament’s finance and budget committee, was set to be made finance minister.

A former Lebanese ambassador to the Arab League, Nassif Hitti, is set to be named foreign minister in the new government, two senior political sources told Reuters.

Reuters quoted political sources saying that Hezbollah would only take two ministries including the health ministry in the next government. In the resigned administration they took three posts, the largest number of ministers they’ve had since entering government in 2005.

The country faces its worst economic crisis since the 1975-1990 civil war that has triggered mass rallies since October. The demonstrations caused caretaker prime minister Saad Hariri to resign after two weeks leading to the political crisis.

The value of the Lebanese Lira has tumbled since the start of the crisis while banks have put in place unofficial capital controls in an effort to prevent a run on lenders. Many have been laid off and prices have risen, hitting the country’s poorest hard.

In the last week, the mass demonstrations have become increasingly violent with clashes between the police and protesters in central Beirut. Nearly 400 protesters were wounded in a demonstration on Saturday in the bloodiest night of rallies so far.

Mr Diab has been trying to form a new administration since being nominated by Hezbollah-allied parties as rival blocs boycotted the election for a new prime minister on December 19. However, his backers have, until now, been unable to decide on the make-up of the administration under the former education minister.

He has promised to form a cabinet of experts in a nod to the demands of protesters for a technocratic government capable of addressing decades of poor governance, corruption and under investment.

However, many of the names floated had close ties to political parties or had served in advisory roles previously. Several of Mr Diab’s political backers – primarily the Amal Movement and the Free Patriotic Movement – have demanded a techno-political administration made up of the parties in parliament although an unconfirmed list of names indicated that there were at least some independent figures.

Any new administration will face a vote in parliament and with nearly half of MPs abstaining in the ballot to pick Mr Diab in December, he will likely need support on all sides of the house to secure their endorsement of his government.

Meanwhile, exchange dealers agreed on Tuesday night to fix the rate of the lira at 2,000 to the US dollar - up on the 1507 Lebanese lira to the dollar official pegged rate. Since the start of the crisis, exchange houses have been trading dollars at steadily increasing rates as the situation deteriorates.