The clouds have been forming above Lebanon’s financial sector for years, and now the storm has come with just one silver lining: most of the debt owed to creditors is held by Lebanese. Theoretically, this means that financial institutions and Lebanese bond holders are the ones who need to sit around a financial kitchen table and discuss how we preserve the collective long-term interest of the country. But that lining is beginning to thin, and fast.

The latest discussion about whether to pay the next segment of dollar eurobonds has been sullied by Lebanese bondholders offloading their debt holdings to international hedge funds—at a significant discount. Such firms have little to no interest in Lebanon or its financial stability, evidenced by the fact that they have just bought up enough of the bonds (25 percent) to have veto power over default negotiations for all 2020-dated bonds. In other words, instead of filling the moat, manning the towers, and stocking up with provisions, local financial institutions with a stake in Lebanon’s long-term financial stability just lowered the draw bridge with financial barbarians at the gate. If Lebanon does not want to surrender then it needs to wise up, fast.

Triangle’s Sami Halabi and Jacob Boswall outline why Lebanon needs an IMF deal – without the austerity – in this Op-Ed for Executive Magazine.