No way out?

The Lebanese national debt, seen in relation to the country’s GDP, has been one of the highest in the world for many years. When the cost of servicing that debt became extreme and international investors lost faith in the country’s ability to manage its finances, it was inevitable for the whole financial system to crash. [inlinetweet prefix=”” tweeter=”” suffix=””]Generations of savings by Lebanese residents and non-residents evaporated through high exposure of banks and the BDL to the sovereign risk. [/inlinetweet]Getting out of the debt trap requires drastic measures. Sovereign debt defaults have been part of the modern world’s economy for centuries; some defaults are even traced back to the fourth century in Greece. Countries choose certain economic, fiscal and monetary policies that put them at risk, and when adverse events occur over a relatively short period of time, the system endures a distress that mostly ends in a financial and