With support from the Economic Development Institute (EDI) of the World Bank, the LCPS undertook a research on Lebanese public finance for the fiscal year 1997-1998. This study researches and analyzes the 1998 draft budget to stimulate informed public debate and awareness of Lebanon's public finances.
The 1998 budget project is essentially an update of last year's report entitled: "Budgetary Politics in Lebanon" which reviewed the 1997 budget proposals. However, rather than repeating the historical analysis of the 1997 study, it concentrates on the fiscal situation of the 1996-1998 period, structural issues in the budgetary situation, and gives an analysis of those macro-economic relations that are particularly sensitive to the composition of the budget.
The purpose of the report, like last year, is to keep the public informed about the principal issues of the 1998 budget proposal. While analysis of fiscal issues continues to be the center of the report, the interaction between key macro-economic aggregates and the fiscal stance are also explored. It attempts to make clear the inter-relationships between the fiscal deficit, interest rates, capital inflows, the level of the reserves and the exchange rate level. This report, like last year, aims to explain the developments and connections, not to judge or prescribe policies.
The study was conducted by Dr. Said Hitti (LCPS consultant), Dr. Kamal Shehadi (Former Director of Research, LCPS) and Ms. Rana Houry (LCPS researcher). Entitled: A Framework for Reducing The Lebanese Budget Deficit, the study was published in English and Arabic in January 1998.