The conference is to be attended mainly by Western governments and Gulf states, in hope of stabilising the government of Fouad Siniora, the Lebanese prime minister, after more than a month of protests by the opposition.

Wide support

Siniora described the plan as a one-time opportunity to regain the confidence of the world before the international donor conference.

He indicated that planned steps include unpopular measures, such as an increase in value added tax - currently 10 per cent - and fuel price rises. The steps would be implemented in 2008.

Nabih Berri, parliament speaker and a member of the opposition, appealed for unity over the rescue package.

He said: "The Paris III conference was a unique opportunity for Lebanon because, after the Israeli aggression, we can't take on the burden of reconstruction alone."

Fighting between Israel and Hezbollah fighters last July and August badly damaged Lebanon's infrastructure and job market. Commerce and investment remain below pre-war levels.

Economic meltdown

Anis Bou Diab, an economist at Haigazian university in Beirut, estimates that since the fighting 25,000 people have lost their jobs in the tourism sector alone.

"The loss in human capital was tremendous ... More than 200,000 left the country - most of them skilled labour. This will greatly reduce productivity," he said. 

Lebanon is estimated to be $41bn in debt.