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MENA Observatory – Lebanon
The Lebanese Central Bank intends to lift subsidies on basic products, which may lead to an escalation of the economic crisis in the country, as the Central Bank sells dollars to suppliers of the main commodities, including medicines, at a lower price than the parallel market, and the latter has 8,700 pounds, compared to 1,515 on the market. Official, the average of 3,200 lira is the rate subsidized by the banks.
Acting Prime Minister Hassan Diab said in a speech after two ministerial meetings to monitor prices: “The losses are the continuation of the subsidies, less the loss than the lifting of the subsidies, and it would be preferable if the Central Bank of Lebanon stopped of financing wasteful policies with depositors’ money.
Diab explained that the tendency to lift the subsidy “is unacceptable in these circumstances, and any step by the Banque du Liban to lift the subsidy is responsible for it, with all those who cover this decision,” without naming them, adding: “No to eliminate drug, flour and fuel subsidies, and the rationalization rule can be adopted. ” Support for the benefit of those in need. The removal of subsidies will lead to disastrous results. Lebanese deposits must be returned, and this is the responsibility of the banks, the Bank of Lebanon and the state.
Last August, the governor of the Banque du Liban, Riad Salameh, issued a warning warning that it could not use its mandatory reserves to finance trade once it reached a minimum.
Lebanon continues to suffer the repercussions of the catastrophic port explosion of August 4, which left hundreds of deaths and injuries, as well as massive damage to infrastructure, in a country essentially going through an economic crisis, the worst since the end of the civil war (1975-1990).
