New national unity government formed in Lebanon

Lebanon agreed a new national unity government on Thursday, ending months of wrangling between rival political factions that has added to concerns for its struggling economy and massive public debt.

Western-backed Saad al-Hariri will face a big challenge in his third term as prime minister in trying to deliver reforms to address the dire state finances and unlock billions of dollars in pledged aid and loans to boost low growth.

The new government will include most Lebanese political factions, who have been negotiating the make-up of the cabinet since a May 6th election, in which allies of the Iranian-backed Hizbullah group gained ground.

Finance minister Ali Hassan Khalil, of parliament speaker Nabih Berri's Amal party, and foreign minister Gebran Bassil, the leader of President Michel Aoun's Free Patriotic Movement, retained their positions, the presidency announced.

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Hizbullah chose the new health minister, Jamil Jabak, although he is not a member of the group, moving beyond the more marginal role it has played in past governments. The ministry has the fourth-biggest budget in the state apparatus, the outgoing minister has said.

As the formation of the new government was announced, Mr Hariri said Lebanon faced economic and financial challenges and the time for treating problems with “painkillers” was over.

“ No one can put their head in the sand any more. Matters are as clear as the sun. All the problems are known and the causes of the corruption and waste and administrative deficiency are also known,” he said.

“Lebanese are living in concern about the economic situation,” he said, adding that the government’s work could not wait. – Reuters