Lebanon's new government held its first meeting Wednesday, a day after it was formed following a three-month political vacuum, with the prime minister saying his Cabinet will adopt financial and economic methods different than those of previous governments.
Even as the government convened, however, protesters briefly closed off major roads in and around the capital Beirut, denouncing it as a rubber stamp for the same political parties they blame for widespread corruption. More protests were planned for later in the day in opposition to the new Cabinet.
The new Cabinet, which has the support of the powerful militant Hezbollah group and its allies, has a monumental task ahead — pulling Lebanon out of its worst economic and financial crisis since the 1975-90 civil war. The crisis worsened since mass protests against the political elite started in mid-October, leading to the resignation of Prime Minister Saad Hariri's government two weeks later.
Prime Minister Hassan Diab and the newly appointed ministers held the first meeting at the presidential palace in Beirut. President Michel Aoun attended the session. The 20-member Cabinet is made up mostly of specialists and includes six women — a record number for Lebanon — holding key ministries, including those of defense, justice and labor.
Aoun told the ministers they have a "delicate mission" to win the confidence of the Lebanese people by working to improve living conditions and the economy. He said they should also work to win the confidence of the international community in "Lebanon's state institutions and reassure the Lebanese about their future."
Analysts say the new government, being politically aligned with the Iranian-backed Hezbollah, will likely have difficulty drumming up the international and regional support needed to avoid economic collapse.
Hezbollah is considered a terrorist organization by the U.S. and oil-rich Gulf countries whose support is badly needed for debt-ridden Lebanon. The European Union considers the military wing of Hezbollah a terrorist organization.
Speaking about the economic and financial deterioration, Finance Minister Ghazi Wazni told the local Al-Jadeed TV that "stopping the deterioration in the coming period cannot be achieved without foreign help."
Later in the day, Diab headed to government headquarters in downtown Beirut where he received a red carpet welcome and was saluted by a military band before formally taking over. Diab said that sacking the central bank governor was not on the table, adding that the new government will have a different financial and economic program.
Diab did not elaborate about the program but some economists have called on Lebanon to work on improving production in the country that imports almost everything. Economists have also called for reducing interest rates so that people invest their money in businesses rather than keep it in bank accounts that offer high returns.
Local banks have been implementing capital controls limiting cash withdrawals and transfers outside the country amid a shortage in hard currency.
Samir Geagea, head of the Christian Lebanese Forces party that refused to take part in the Cabinet, criticized the new government saying that after three months of protests the state "is behaving as if nothing happened." He said "most of the ministers are connected to political groups that brought the country to where it is" today.
U.N. Secretary-General Antonio Guterres welcomed the formation of a new government, saying "he looks forward to working with" Diab and his Cabinet, "including in support of Lebanon's reform agenda and to address the pressing needs of its people."
The Association of Banks in Lebanon said it expects from the new government a "clear financial and economic program that takes into consideration the big challenges that Lebanon is facing." It added that the banking sector is ready to help in getting Lebanon out of its crisis.
Also on Wednesday, the U.S. dollar was being bought at exchange shops around the country for 2,000 Lebanese pounds after hitting a record of 2,500 pounds to the dollar last week. The official rate remained at 1,507 pounds to the dollar. Panic and anger have gripped the public as the pound, pegged to the dollar for more than two decades, plummeted in value. It fell more than 60% in recent weeks on the black market.