Lebanese government budget talks likely to continue through next week

Lebanese government talks over a new state budget will stretch beyond Friday, the information minister said, longer than he had previously announced and pointed to the difficulties in agreeing to a package of austerity measures. Ministers had for now "set to one side" proposals over the public sector wage bill, the state's biggest expense, and ministers would return to talks on Friday with new proposals to bring down operating expenses in their ministries, Jamal al-Jarrah said in a statement.

Asked if Friday would be the last cabinet session on the budget, Jarrah said: "No, it will not be the last." He said that "God willing" there would be further sessions on Saturday and Sunday. Proposals in the draft state budget to cut pay and benefits in the bloated public sector have caused a wave of strikes and protests including a walkout at the central bank. The strikes were suspended on Tuesday.

Central bank workers are due to convene a meeting on Friday to decide whether to resume or call off their strike. "The salary article (of the budget) has been put to one side so we can see what can be done with the other articles," Jarrah said.

Prime Minister Saad al-Hariri said on Monday that failure to pass a "realistic" budget would amount to "a suicide operation" against the economy. All parties in Lebanon's coalition have said reforms are needed to reduce the country's public debt, equivalent to about 150 per cent of gross domestic product.

International agencies including the International Monetary Fund and the World Bank have urged Lebanon to put its debt on a more sustainable trajectory.