On the black market, the value of the Lebanese pound has dropped to an all-time low of 100,000 LBP against the US dollar, marking yet another sad chapter in an economic collapse that has left most people in abject poverty.
The Lebanese pound, which is supposed to be worth 15,000 dollars per dollar, was trading at 100,000 dollars per dollar on Tuesday, dealers said. This is a huge drop from 1,507 dollars per dollar before the economic crisis hit in 2019.
In late January, the market value of the currency was about 60,000 to the dollar.
Even though the crisis is terrible, the political elite, widely blamed for the country’s financial collapse, have not been able to stop the currency from falling.
Since last year, the country hasn’t had a president and has only had a caretaker government. This is because rival alliances in parliament haven’t been able to come to an agreement.
Lebanese banks, which have for a long time made it hard for people to get their money out (basically locking them out of their life savings), were closed on Tuesday as they went back on an indefinite strike.
The strike started at the beginning of the month to protest what the Association of Banks in Lebanon called “arbitrary” court actions against lenders after depositors sued to get their money back.
In response to the lawsuits, some judges tried to take the money of bank directors or board members or force lenders to pay out customers’ dollar deposits in pounds at the old exchange rate of 1,507.
As caretaker Prime Minister Najib Mikati interfered at the end of last month to obstruct the work of one of the judges probing banks, customers were given a two-week reprieve from the strike.
Over the past three years, people have been angry about the limits on how much money they can take out of the bank. Some Lebanese have even turned to armed robberies to get their own money.
The fronts of many banks in the capital are almost unrecognisable from the outside because they are covered with metal panels for protection. ATMs have been broken into, and bank branches have been closed for days.
After the pound fell to about 80,000 against the dollar in mid-February, dozens of angry protesters attacked several banks in Beirut.
A lack of political action and accountability has marked the Lebanese economic crisis.
Officials haven’t made any of the changes that international creditors have asked for in order to get emergency loans worth billions of dollars.
In April of last year, the International Monetary Fund (IMF) said that it had agreed in principle to lend Beirut $3 billion over four years, but only if it made several big changes.
Lebanon is facing an economic collapse without much of a leader because its politicians are split and haven’t been able to agree on a new president for months. The country is already run by a caretaker cabinet that doesn’t have much power.
Since Michel Aoun’s term ended in October, Lebanon has been without a leader. Parliament has met many times to choose a new leader, but they have never been able to agree on a single candidate.