Dealers in the exchange market in Lebanon reported that the Lebanese pound recorded – today, Thursday – an unprecedented low level of 50 thousand pounds to the dollar, which implies a decline in its value by more than 95% since the collapse of the financial system in the country in 2019.
The lira was pegged to the dollar at a price of 1,507 pounds in 1993, a peg that continued until 2019 when decades of waste, mismanagement and corruption caused a financial crisis.
The largest paper in circulation, the 100,000-pound note, which was worth $67, is now worth only two dollars.
The deterioration of the Lebanese pound coincides with an acute liquidity crisis, and banks have stopped providing depositors with their money in dollars.
Banks and money transfer companies adopt different exchange rates.
The prolonged economic crisis is considered the worst in Lebanon’s history. Over the course of 3 years, more than 80% of the population has become below the poverty line, according to the United Nations.
According to a recent study by the United Nations World Food Program, about two million people in Lebanon suffered from food insecurity between September and December 2022.
The authorities have not yet succeeded in implementing reforms required by the international community to provide support in order to stop the bleeding.
And the fund announced last April that it had reached a preliminary agreement with Lebanon on an aid plan worth $3 billion over 4 years. However, its implementation is also linked to the authorities’ commitment to implement prior reforms, including the unification of exchange rates.
