Paris conference pledges $7.6 bln for Lebanon
Source: Reuters
(Updates with details on pledges, Chirac comment) By Crispian Balmer and Arshad Mohammed PARIS, Jan 25 (Reuters) - Lebanon obtained $7.62 billion in aid and loan pledges on Thursday to help it recover from war and enable its Western-backed government to weather a growing threat from Hezbollah-led opponents. But as the promises of aid poured in, there were fresh clashes on the streets of Beirut between pro and anti-government supporters in which four people were killed and 100 injured. Saudi Arabia headed the list of donors with a promise of $1.1 billion of credits and grants, the United States pledged $770 million and the Arab Monetary Fund and World Bank each offered funding of around $700 million. "I'm going away really pleased with the level of financial support offered today," Lebanese Prime Minister Fouad Siniora told reporters at the end of the meeting. "This conference is an expression of faith in the Lebanese nation and people." Lebanon's efforts to rebuild after its 1975-1990 civil war suffered a serious setback last year when Israel and Hezbollah guerrillas fought a 34-day war that shattered the country's fragile infrastructure. The political situation has since deteriorated, with the Shi'ite Hezbollah opposition group spearheading increasingly tense protests aimed at ousting Siniora's Sunni-led government. "The people of Lebanon deserve to live in peace. They deserve to make decisions about their political future free from the threat of violence and free from political intimidation," U.S. Secretary of State Condoleezza Rice told the conference. She later told a news conference: "The future of Lebanon is important not only to the people of Lebanon but also to the future of a troubled region." DEBT WOES Lebanon is weighed down by $40 billion of debt, equal to 180 percent of gross domestic product, and Thursday's pledges should ease, but by no means resolve, its financial problems. France said $730 million of the pledges were donations, while the rest came in the shape of low-interest loans, grants and development aid -- much of it with strings attached. Only $1.95 billion would be made available this year and $1.21 billion of the total sum came from private-sector pledges. "In spite of past experience, it is now the duty of the Lebanese to prove that they can work together with the international community to bring back what they lost in the strife that they have faced," Saudi Foreign Minister Prince Saud al-Faisal told the closing news conference. Hezbollah has accused Siniora of being in the pocket of the West, and government opponents have said the Paris conference was aimed at maintaining him in power. Donor countries denied that and the new U.N. Secretary General Ban Ki-moon said the pledges would be vital to rebuilding Lebanon, but flatly added: "this will not be enough." Ban urged the Lebanese people to seek national reconciliation and "to exercise maximum restraint, refrain from violence, and to engage in continuous and sincere dialogue". The amount pledged on Thursday easily exceeded the $4.2 billion offered at a previous donors' conference for Lebanon in Paris in 2002. On that occasion the United States refused to make any firm commitments, in stark contrast to 2006. Some donors said they would link their aid to Siniora's ability to push through a potentially unpopular reform package unveiled this month, which includes plans for privatisations, cutting state spending and hiking taxes. "Throughout all the ordeals it has suffered, Lebanon has always been capable of finding the strength to pick itself up," French President Jacques Chirac told the conference. "I have no doubt that with the help of all of us, it will succeed once again in surprising us with the vigour of its renaissance," he said. (Additional reporting by Francois Murphy and Elizabeth Pineau)
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