Lebanon will discontinue payments on all its foreign currency denominated Eurobonds
Lebanon will discontinue payments on all its foreign currency denominated Eurobonds as the Government advances on its plan to stabilise and restart the economy amidst global uncertainty
On 7 March 2020, Lebanon announced its decision to withhold payments on its 6.375% US$1,200,000,000 bonds due 9 March 2020 in order to safeguard foreign currency reserves. In furtherance of this objective, and as reinforced by the further pressure on Lebanon’s access to foreign currency, the Government has decided to discontinue payments on all of its outstanding US$-denominated Eurobonds (ISIN numbers listed below).
In addition, the Government will take all measures it deems necessary to prudently manage Lebanon’s limited foreign currency reserves.
The Government remains firmly committed to its three-pronged economic reform initiative and is developing a sustainable macroeconomic plan to redress the Lebanese economy.
As previously announced by Prime Minister Hassan Diab, Lebanon’s economic reform initiative is aimed at:
- restoring the sustainability of the Government public finances through the restructuring of its public debt and a series of fiscal measures;
- creating a conducive environment for growth through a comprehensive structural reform agenda, including measures to improve governance and fight corruption;
- stabilising and reforming the financial system through the restructuring of the banking sector.
The Government intends to engage in good faith discussions with its creditors as early as practicable. To that end, the Ministry of Finance plans to hold an investor presentation on 27 March 2020. Lazard Frères, Lebanon’s financial advisor, has been instructed to initiate arrangements as appropriate under the current circumstances to facilitate such good faith discussions. Information for creditors will be posted regularly on the website of the Lebanese Ministry of Finance.