By Suleiman Al-Khalidi
BEIRUT, Sept 2 (Reuters) - Lebanon will declare an economicemergency and the government has begun work on a plan toaccelerate public finance reforms, its prime minister said onMonday.
Saad al-Hariri also said the policy of keeping stable theLebanese pound, which is pegged to the dollar, would continue.
Cabinet ministers, politicians and lawmakers who met onMonday reached consensus on an outline for a plan that would putpublic finances and the economy on a more sustainable path,Hariri said.
"There is agreement to announce a state of economicemergency," Hariri said.
"This difficult economic situation requires us taking speedymeasures such as finishing the budget on time and reducing thedeficit" Hariri told reporters after the meeting that PresidentMichel Aoun also attended to address a worsening economicsituation.
The government would hold more meetings to speed up thework, he said.
Lebanon is grappling with one of the world's heaviest publicdebt burdens at 150% of GDP and years of low economic growth.
Government finances, plagued by corruption and waste, arestrained by a bloated public sector, debt-servicing costs andsubsidizing the state power producer.
Hariri said accelerating reforms would avoid a crisissimilar to Greece, which fell into a debt crisis nine years agoand had to adopt tough austerity measures under tightsupervision by foreign creditors.
"We don't want this to happen to us. So we are takingmeasures to save the country," the prime minister said.
Hariri said Lebanon's credit rating downgrade by Fitch toCCC 10 days ago was a warning to take the needed measures toshore investor confidence before it was late.
Fitch said its downgrade from B- reflected "intensifyingpressure on Lebanon's financing model and increasing risks tothe government's debt servicing capacity."
Lebanese leaders have warned of a financial crisis withoutchanges. The impetus to enact reforms has grown with theslowdown of deposits into Lebanon's banking sector, a criticalsource of finance for the state.(Reporting by Suleiman Al-Khalidi; Editing by Lisa Barringtonand Catherine Evans)