BEIRUT, March 7 (Xinhua) -- Lebanese Prime Minister Hassan Diab announced on Saturday that Lebanon will not be able to repay Eurobonds due on March 9 and it has decided to restructure its debt, Al Jadeed local TV channel reported.
"Our foreign reserves have dropped to a dangerous level. We need our money to finance the basic necessities of the Lebanese," Diab said following a meeting at Baabda Palace with top leaders and the central bank governor, and another meeting later for the cabinet to discuss options amid prevailing financial deterioration.
Lebanon has to repay approximately 4.6 billion U.S. dollars for bonds in 2020 with 1.2 billion dollars due in exactly two days.
Diab said the government will negotiate with creditors to reach a fair debt restructuring.
However, Diab assured that the government has studied all its options and reached this decision in the aim of protecting the public interest while at the same time adopting a complete reform program to re-activate the ailing economy.
Lebanon's public debt to GDP has reached 170 percent while the government is incapable of paying back its dues because of the failing policies adopted by successive cabinets over the past years.
Meanwhile, the country has also been facing a serious financial crisis amid a drop in U.S. dollar currency which prompted banks to put unofficial restrictions on people's withdrawals from their dollars deposits.
This has created huge fears among people about losing their savings.
Diab assured that he cares about people's interests and the capacity of his cabinet to restore confidence and the ability to secure a good life for the Lebanese.
He vowed to protect small depositors' money which constitute 93 percent of deposits in Lebanese banks.
The prime minister also promised to implement serious reforms including a proper strategy for the electricity problem in addition to securing funds for the medical sector, infrastructure and education.
"We will stand against tax evasion and increase our capacity in tax collection. We will also adopt a social safety system to protect the most vulnerable people in addition to a strategy for the fight against a corruption," he said.
Lebanon has been witnessing nationwide protests since Oct. 17 of last year against the ruling political system and its policies.
