In Lebanon, the pound hits all-time low, sparks street anger

In the midst of economic collapse, Lebanon continues to sink into the doldrums. The pound hit a historic low on the black market on Tuesday 2 February, trading around 10,000 pounds to the dollar, and also sparking anger in the streets.

Officially, the local currency remains pegged to the greenback at the rate of 1,507 pounds to the dollar – it has been for more than two decades. But, on the black market, since the fall of 2019, it has experienced an unprecedented plunge. On Tuesday, the dollar was trading at 9,900 to 10,000 pounds, several brokers said.

“It’s crazy, what’s going on”one of them said on condition of anonymity. The greenback has been trading around 8,000 to 9,000 pounds in recent weeks. By July 2020, he had already hit 9,800 pounds.

Lebanon is embroiled in the worst economic crisis in its history for decades, which is exacerbated by a political stalemate as well as the pandemic. This minimum known to the Lebanese pound provoked the anger of the street: gatherings took place in several regions of the country, in addition to Beirut: in Tripoli (north), in Saïda (south) and in Bekaa (east), where dozens of angry protesters blocked roads with torched tires and overturned dumpsters.

Some of them took up in chorus the flagship slogans of the “revolution” of October 17, 2019, the date of the start of an unprecedented protest movement against a ruling class unchanged for decades and accused of corruption and incompetence.

Article reserved for our subscribers Read also In Lebanon, the army is not immune to the financial crisis

“Unsustainable situation”

“I call on everyone to take to the streets. The situation has become unbearable ”, launched a protester at the microphone of a local channel on the Place des Martyrs, stronghold of the movement in Beirut. “We will stay here until we bring this class down [politique] corrupt, with Michel Aoun at its head ”, added another, a keffiyeh wrapped around his neck.

The new fall in the pound comes at a time when the central bank (Banque du Liban, BDL) has started to scrutinize the financial situation of the banks, against the backdrop of international pressure to restructure the sector.

Lebanese banks had until Sunday to increase their capital by 20%, one of the measures demanded by the BDL to boost their solvency and their level of liquidity. The depreciation has already led to a drastic increase in prices in 2020, and poverty now affects half of the population.

The hashtags #dollar and # marchénoir topped Twitter trends in Lebanon on Tuesday. “The exchange rate has reached 10,000 pounds, and there is still no government”, lamented a user.

Article reserved for our subscribers Read also Drug shortages worsen in Lebanon

The country has been waiting for more than six months for the formation of a new cabinet. The current government resigned after the deadly and devastating August 4 explosion at the Port of Beirut, yet it continues to run day-to-day business. “The Lebanese pound collapses further the political stalemate continues and no policy to stem the collapse ”analyst Maha Yahya of the Carnegie Center for the Middle East wrote on Twitter.

Article reserved for our subscribers Read also “People are so afraid that they have piled up medicines at home”: in Lebanon, the difficult daily life of a country in slow motion

The world

LEAVE A REPLY

Please enter your comment!
Please enter your name here