The Association of Banks in Lebanon (ABL) published on May 20, 2020 its contribution to the Lebanese Government's Financial Recovery Plan. The ABL's plan consists of five strategic priorities that support an immediate and sustainable economic and financial recovery, as opposed to the government's plan that envisages a shrinking of nominal GDP by $16bn in the 2020-24 period. The ABL considered that the government's plan is an accounting exercise, that it seeks to achieve ''ephemeral equilibrium'' through an internal default; and that it does not offer an economic vision to drive the economy out of recession. 
 
First, the ABL advocates for a restructuring of the public debt that minimizes negative repercussions on bank depositors and on the economy, and that allows for a faster economic recovery and higher medium-term growth potential. Specifically, it calls on the government to avoid defaulting on its internal debt, as it estimated that an internal default will lead to unsustainable external financing requirements, which exceed the $28bn that the government forecasts in its plan for the 2020-24 period. Instead, it projected the country's external financing requirements at about $8bn in the 2020-24 period in case Lebanon avoids an internal default. It estimated that Lebanon could receive up to $3.9bn in financial support from the IMF over three years, with an annual limit of $1.3bn. It noted that Lebanon will need additional multilateral and bilateral external financing, including access to the funding pledged at the CEDRE conference, as well as potential support from the Diaspora in order to close the external funding gap. 
 
As such, the ABL's plan envisages a settlement mechanism of the government's debt to BdL. It suggests that the government creates a ''Government Debt Defeasance Fund'' (GDDF), which will include public assets valued at $40bn, such as the telecommunication operators, public lands and other public real estate assets, and/or exploration rights and concessions. The government will own 100% of GDDF's shares in exchange of the contributed assets. The GDDF will then issue $40bn worth of long-dated, interest bearing, covered securities to Banque du Liban (BdL) in exchange for the debt that the government owes to BdL. Further, the ABL called on the government to reprofile the debt held by non-residents, as well as the domestic debt, excluding the debt settled between the government and BdL. It said that the Ministry of Finance will need to launch a voluntary debt exchange offer for the domestic debt, which will be subject to a minimum acceptance threshold set by the government. It also noted that the plan offers non-resident Eurobond holders several options, including exchanging their outstanding Eurobonds for newly-issued securities under New York law, or exchanging them for new securities governed by Lebanese law. The ABL anticipates that the successful reprofiling of the internal and foreign debt will put the public debt level on a sustainable path. 
 
Second, the ABL suggests a medium-term fiscal strategy that will help restore the sustainability of the public debt and that will protect the vulnerable segments of the population. It noted that the economic adjustment program will allow the primary budget balance to post a surplus of 2.1% of GDP by 2024, which will help put the public debt on a downward trend. It added that the adjustment will incorporate a social safety net equivalent to 4% of GDP by 2024. Third, the ABL called on the government to unify the multiple exchange rates in order to address the massive external imbalances, supported by a monetary policy that will help contain inflationary pressures and avoid hyperinflation. It suggested that authorities manage a ''dirty float'', where BdL intervenes in the market during unwarranted volatility. 
 
Fourth, the ABL advocates for an orderly restructuring of the banking sector on a case-by-case basis, as it considers that a one size-fits-all approach of the banking sector's restructuring will harm the economy. It considers that, in order to restore confidence, the banking sector must not default on its depositors. It pointed out that the deep economic recession that started in 2019, along with the de facto currency devaluation, the government's decision to default on its Eurobonds, and its intent to default on the country's internal debt, have undermined the banking sector's capital position. It suggested that BdL will assess the capital position of each bank separately and then decide which institutions, if any, need to be resolved. The ABL anticipates that BdL will also encourage some of the more weakly-capitalized financial institutions to merge, while it will allow others to continue operating provided that they fully comply with Basel III capital and leverage ratios by the end of 2025. 
 
Fifth, the ABL suggests the implementation of reforms that will help diversify the economy and improve the business environment, such as reducing the cost of doing business, reforming public procurement, fighting corruption, and lowering the size of the informal sector.