On March 2, 2021, the Lebanese pound hits a new record low against the United States dollar on the black market. This is a result of the country’s multiple crises deepening with no prospects for a new Cabinet in the near future.
The crash of the local pound has resulted in a sharp increase in prices led to the outbreak of small protests in different parts of Lebanon on Tuesday.
A scarcity of laborious foreign money has additionally led to delays within the arrival of gas shipments, resulting in extra prolonged energy cuts across the nation.
Lebanon one of the nations on the planet that’s depending on gas oil and diesel oil to obtain electrical energy.
Lebanon has been affected first by the outbreak of anti-government protests in opposition to the nation’s corrupt political class in October 2019. That has been compounded by the coronavirus pandemic and a large blast in Beirut’s port final August that decimated the ability.
In Syria where the economy has been ravaged by a 10-year conflict, corruption, and Western sanctions, the dollar also hit a record on Monday, reaching nearly 3.900 Syrian pounds. The economies of Syria and Lebanon are connected. Many Syrians have had their money blocked in Lebanese banks that have implemented harsh capital controls to stem the outflow of dollars. Lebanon has also been in desperate need of foreign currency, but international donors have said they will only help the country financially if major reforms are implemented to fight widespread corruption.
The problems of the Lebanese pound also came after an end-of-February deadline for the country’s banks to raise their capital after they were hit hard by the crisis.
Lebanese business writer Hala SAGHBINI wrote on tweeter: “The dollar is equal to 10,000 pounds. People are hungry, prices are flying and there is no electricity”. “We want a government immediately. Enough humiliation of the people”.
In December 2020, the World Bank warned that Lebanon’s economy faces an “arduous and prolonged depression”, with the GDP projected to plunge by nearly 20 % because the country’s politicians refuse to implement reforms that would speed up its recovery.
In March 2020, Lebanon defaulted for the first time ever on a payment on its massive debt amid ongoing popular unrest. Lebanon’s debt reached $90bn or 170 % of GDP, which is one of the highest in the world.
This article was edited using the data from the Aljazeera.com, Inter-empresarial.com, Pressfrom.info/au, and Middle-east-online.com.