From Voice Of America

This week will be decisive in efforts to form a government in Lebanon, representing a last chance to break the deadlock, Prime Minister-designate Saad al-Hariri said Tuesday.

The formation of a government nine months after an election is seen as a vital first step toward boosting confidence in the economy as political leaders warn of crisis.

The International Monetary Fund has called for urgent fiscal reforms to address the country’s large public debt, equivalent to about 150 percent of GDP.

“Matters are positive and will become clear within two days. … This week is decisive, positively or negatively,” Hariri was cited as saying in a statement from his office, adding that he was “cautiously optimistic.”

The situation could not go on like this, and this week represented “a last chance to settle things and to launch the government formation,” Hariri was quoted as saying.

Members of parliament from President Michel Aoun’s party, the Free Patriotic Movement, said in a statement the government could be formed this week if concessions were made by all sides.

If not, then “next week we will have something else to say … because then it will be clear that is an intention to obstruct the birth of the government,” the FPM’s Cesar Abi Khalil said in a statement after a meeting of the MPs.

On Saturday, the leader of Lebanon’s powerful Iran-backed Hezbollah movement said “extraordinary efforts” were being made to form the government, but two obstacles remained — how to include a group of six Sunni lawmakers in the cabinet and the distribution of government portfolios among the political parties.

Credit ratings agency Moody’s last week downgraded Lebanon’s sovereign debt, citing the uncertain movement toward forming a government, and Lebanese bonds have suffered in recent weeks.

Lebanon is one of the world’s most indebted countries and its finance minister has said it is in an economic crisis that has started to turn into a financial one, and hopes it will not become a monetary one.