BEIRUT – Lebanon’s currency hit a new low against the United States dollar on the black market today, continuing its freefall in a country gripped by political deadlock and an economic crisis.
The latest plunge means the Lebanese pound has lost almost 90% of its value on the informal market in just 18 months.
The currency has been pegged to the dollar at 1,500 since 1997, but the country’s worst economic crisis since the 1975-1990 civil war has seen its unofficial value plummet.
The slide has picked up speed over the past two weeks, with the exchange rate soaring from 10,000 Lebanese pounds to the dollar on March 2 to around 15,000 today.
Three money changers said they are buying dollars for 14,800 to 14,900 Lebanese pounds, while a customer told AFP that they sold the foreign currency at 15,000 pounds to the dollar.
The fall has led to soaring food prices in a country where more than half the population now lives below the poverty line.
The smell of burnt tyres wafted over the city here today after gaggles of protesters took to the streets in the capital and elsewhere in the nation, in the latest such demonstrations in recent weeks.
“Lebanon exchange rate reaches 15,000LL to 1$. Last night it was 13,250,” tweeted analyst Maha Yahya.
“Country collapsing around us & we are unable to do anything,” added Yahya, who is director of the Carnegie Middle East Centre.
Since autumn 2019, banks have largely prevented ordinary depositors from accessing their dollar savings or transferring them abroad, forcing them to resort to the black market to obtain foreign currency.
In a country that needs dollars to import goods, several shops have closed their doors in recent days to reprice goods, and some factories have halted production.
The government resigned last August after a devastating port blast that killed 200 people and ravaged a large part of the capital.
However, the deeply divided political class has failed to form a new cabinet to enact desperately needed reforms to unlock billions of dollars in promised international aid.
France and the US last week hit out at Lebanon’s squabbling politicians, with Paris saying they are failing to help the country as it slides towards “total collapse”.
France has taken a leading role in trying to break the political deadlock in its former protectorate, with President Emmanuel Macron visiting Lebanon twice last year. – AFP, March 16, 2021
