Today, Tuesday (March 14, 2023), the Lebanese currency deteriorated to an unprecedented level, and its exchange rate reached one hundred thousand against one dollar in the parallel market, according to what Agence France-Presse quoted from exchange offices in the country mired in a stifling economic and financial crisis.
And it was official exchange rate It was set at the level of 15,000 pounds against the dollar last February, compared to 1,507 pounds previously.
This official exchange rate remains six times lower than the actual price of the pound in the parallel market, where the Lebanese currency is traded on Tuesday at 100,000 pounds against the dollar, according to exchange offices. This coincides with an acute liquidity crisis And the banks stopped providing depositors with their money in dollars .
On Tuesday, the banks resumed an open-ended strike that they had started in February to protest against judicial decisions that obligated some of the banks to accept the payment of foreign currency debts belonging to them, in Lebanese pounds, while other decisions obligated them to pay deposits to some depositors in foreign currency. Banks described these decisions as “arbitrary,” noting that they are “double standards,” according to a statement issued by the Association of Banks.
After several complaints, judges issued decisions prohibiting the disposal of the property of a number of banks and the funds of the heads and members of their boards of directors.
Banks reopened after caretaker Prime Minister Najib Mikati intervened at the end of February. In mid-February, dozens of depositors smashed bank facades and burned tires in Beirut to demand access to their outstanding deposits.
Since the summer of 2019, Lebanon has been witnessing an economic crisis that the World Bank ranked among the worst since 1850, and it is considered the worst in Lebanon’s history.
In early March, Supermarkets began pricing goods in dollars By a decision of the authorities regarding the rapid decline in the value of the local currency. It was preceded by months ago, restaurants and stores in a country that imports 90% of its goods. rose Food prices skyrocket Since 2019. According to the World Bank, the inflation rate reached 332% from January 2021 to July 2022, which is the highest in the world.
In a related context, the World Bank Vice President for the Middle East and North Africa, Farid Belhaj, announced, after his meeting with Lebanese caretaker Prime Minister Najib Mikati, that the World Bank will support the poor in Lebanon with a value of $300 million in the coming months, and support for agriculture with a value of $200 million. But there has to be a level of understanding and credibility to move forward with these projects.”
Politically, Lebanon has been experiencing a vacuum in the authority of the country’s president since the end of former President Michel Aoun’s term at the end of October, and the failure of political parties to agree on a new president, which increased the inability of institutions to work in a country where one of the worst economic crises in the world has worsened in years. .
On the second anniversary of the port explosion.. Lebanon is still in pain!
The port explosion… a wound still bleeding
On the 4th of August 2020, a massive explosion occurred in Beirut. The authorities attributed the explosion to large quantities of ammonium nitrate stored in Ward No. 12 at the port since 2014. The explosion, which is one of the largest non-nuclear explosions recorded in the world, caused massive damage to the port and its nearby neighborhoods, killing 214 people and injuring 6,500 others. Experts said the silos absorbed much of the impact of the blast, sparing the city even worse damage.
On the second anniversary of the port explosion.. Lebanon is still in pain!
The collapse of the grain silos is opening up the wounds
Although two years have passed since the horrific explosion, the sight of the destroyed silos still hurts the Lebanese today. Recently, a fire broke out, officials said, as a result of the summer heat setting fire to the rotting grain inside, which subsequently led to the collapse of part of the silos. Citizens rejected a proposal to remove the destroyed buildings and insisted that they remain to remind everyone of the tragedy. The Lebanese view the explosion as a symbol of corruption and mismanagement by the ruling elite.
On the second anniversary of the port explosion.. Lebanon is still in pain!
The first Ukrainian grain ship .. to Lebanon
The suffering of many countries is increasing due to the Russian invasion of Ukraine. However, following an agreement sponsored by Turkey and the United Nations between Russia and Ukraine, the first ship carrying Ukrainian grain left the port of Odessa, heading to Lebanon. According to the agreement, the cargo ship “Razoni”, which flies the flag of Sierra Leone, will be inspected first in Istanbul by the concerned parties, before continuing its journey towards its final destination, which is the Lebanese city of Tripoli.
On the second anniversary of the port explosion.. Lebanon is still in pain!
The case of the ship “Ludicea”
As part of the latest repercussions of the Russian-Ukrainian war, the Public Prosecutor in Lebanon issued a decision to seize a ship carrying barley, which the Ukrainian embassy in Beirut said was illegally loaded from areas in Ukraine that have come under Russian control. The ship “Ludicea”, flying the Syrian flag, was detained in the port of Tripoli in northern Lebanon, while the General Directorate of Customs and Internal Security Forces began conducting investigations.
On the second anniversary of the port explosion.. Lebanon is still in pain!
The economic collapse does not stop
Lebanon is suffering from a severe economic crisis, which the World Bank classified as one of the worst in the world since 1850, which led to the local currency losing more than 90% of its value against the dollar, and the central bank’s ability to support the import of vital commodities, including wheat, fuel and medicines, has diminished. Since the beginning of the crisis, the Lebanese authorities have held part of the responsibility for the collapse of more than a million Syrian refugees who live in difficult humanitarian conditions after fleeing the war in their country.
On the second anniversary of the port explosion.. Lebanon is still in pain!
Bread crisis.. Is there hope for a solution soon?
In light of the economic crisis, the Lebanese Ministry of Economy has raised the price of bread several times over the past two years. The Russian invasion of Ukraine exacerbated the difficult situation in Lebanon due to the suspension of wheat exports, especially since Lebanon imports 80% of its needs from Ukraine. Every day, the queues in front of bakeries are getting longer, and the price of a bundle of subsidized bread (6 loaves) has risen to 13,000 Lebanese pounds, while its price exceeded 30,000 on the black market.
On the second anniversary of the port explosion.. Lebanon is still in pain!
Protests erupt
The Lebanese government’s announcement in late 2019 of its intention to impose a fee on free calls via electronic messaging applications such as WhatsApp, angered the Lebanese. The announcement coincided with the collapse of the price of the lira and the exacerbation of the bread crisis, prompting thousands to take to the streets to express their rejection of the decision and their desire to overthrow the regime.
On the second anniversary of the port explosion.. Lebanon is still in pain!
The resignation of the Hariri government
Despite the Saad Hariri government’s retraction from imposing a financial fee on communications, the protests continued. Demonstrations increased and the ceiling of demands rose to the demand for the departure of the ruling class, which has not been affected by fundamental change for decades and is accused of corruption and incompetence. In the wake of the demonstrations, Hariri resigned on October 29, 2019, while the pace of the financial crisis accelerated. Depositors’ funds were frozen amid a hard currency liquidity crisis and the collapse of the local currency
On the second anniversary of the port explosion.. Lebanon is still in pain!
The port explosion topples the Diab government
On August 8, 2021, thousands of Lebanese demonstrated against Lebanese officials whom they held responsible for the tragedy of the Beirut port explosion. The demonstrations witnessed violent confrontations between angry protesters and the security forces, who used tear gas and rubber bullets. Later, a number of ministers announced their resignation, until Prime Minister Hassan Diab announced on August 10, 2021, the resignation of his government.
On the second anniversary of the port explosion.. Lebanon is still in pain!
Macron initiative
On the first anniversary of the port explosion, French President Emmanuel Macron organized an international conference to support Lebanon, the third in cooperation with the United Nations. France pledged 100 million euros in financial aid to Lebanon, in addition to half a million doses of coronavirus vaccines. Through the conference, Paris sought to collect urgent humanitarian aid worth $350 million.
On the second anniversary of the port explosion.. Lebanon is still in pain!
Corona crisis
In February 2020, Lebanon recorded its first case of coronavirus. The burdens gradually accumulated on the health sector, which was exhausted by the dire economic situation in the country. In the absence of government plans to deal with the virus and the continuation of economic and political crises, the country’s epidemiological situation began to take a worse turn with the outbreak of the Delta mutant.
On the second anniversary of the port explosion.. Lebanon is still in pain!
successive crises
In light of the accelerating economic collapse, more than half of the Lebanese are below the poverty line, according to the United Nations. The Lebanese pound also lost more than 90 percent of its value against the dollar on the black market, while the prices of all materials and commodities increased, so that the prices of basic foodstuffs rose by more than 70 percent in two years. The country is also witnessing a fuel crisis, a shortage of medicine, and power outages of up to 22 hours.
On the second anniversary of the port explosion.. Lebanon is still in pain!
Frozen port issue and political crisis with the Gulf
On October 14, 2021, the situation flared up due to sectarian objections to the performance of the judicial investigator in the port explosion, Judge Tariq Al-Bitar, and a shooting took place, killing 7 people, and the case was frozen due to the influx of complaints against the judge by officials who accused them of being involved in the disaster. In the same month, the Gulf states summoned their ambassadors, and Saudi Arabia banned Lebanese imports, in protest against the statements of then Information Minister George Qirdahi over the war in Yemen.
On the second anniversary of the port explosion.. Lebanon is still in pain!
Health concerns from the impact of new fires
With the fires returning to the destroyed grain silos, the Beirut sky glowed orange in the darkness of the night inside a port that still looked like a disaster area, amid expectations of more collapses, not only in buildings but in various sectors. Health and environment experts recommended that residents of the area near the silos wear special masks to protect them from the effects of burning rotten grains and the germs they carry. When will Lebanon get out of its crises? Prepared by: Emad Hassan / Iman Maluk
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