People pose near empty restaurants in Downtown Beirut, Thursday, Feb. 22, 2018. (The Daily Star/Hasan Shaaban)
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The problem for Lebanon, the world's third most-indebted country, is that it's starting to look more like Greece financially.There's also a U.S.-led effort to curb the power of Lebanese militant group Hezbollah.Lebanese bonds have tumbled and bank deposits are growing at their slowest pace since the end of the Civil War almost 30 years ago.It currently amounts to $79 billion, or 150 percent of GDP, though the IMF said Lebanon would likely see it reach 180 percent in five years.Lebanon will seek to raise funds for a $16 billion infrastructure program at a donor conference scheduled next month in Paris.The yield on Lebanon's dollar-denominated bonds due 2037 jumped 59 basis points last month, the most since the debt was issued last year.Some Gulf countries, including Saudi Arabia, have balked at helping Lebanon financially like they did in the past because of Hezbollah, the Iranian-backed group that wields so much influence in Lebanon.Lebanon relies on private-sector bank deposits, mainly from millions of Lebanese living abroad sending money back, to keep the banks stable and defend the dollar peg.As long as the money kept flowing, banks were happy to gobble up government debt.Lebanon saw outflows of $2 billion after Hariri announced his surprise resignation.
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