Protests in Lebanon as local currency hits record low

BEIRUT (AP) — Protests broke out across the country on Tuesday after the Lebanese pound hit a record low against the dollar on the black market, a sign of deepening multiple crises and no prospects for a new Cabinet in sight.

The crash in the local currency that has resulted in a sharp increase in prices led to the outbreak of small protests in a number of cities around the country. In some, demonstrators blocked roads with burning tyres.

Several major roads were closed, including in the capital Beirut, where the highway leading to the international airport was briefly closed before soldiers reopened it. Roads were also closed in the northern city of Tripoli and in Sidon, Lebanon’s second and third largest cities.

After sunset, more protesters poured into the streets and closed the main highways that link Beirut with the country’s north, south and the eastern Bekaa Valley.

“There is no way to get back our dignity other than the street,” a protester in Beirut told a local TV station. Many of the protesters put on masks amid an increase in cases of coronavirus. The Health Ministry reported on Tuesday 3,098 new cases and 62 deaths despite a weeks-long lockdown.

A boy jumps over burning tyres that were set on fire to block a road, during a protest in Beirut, Lebanon. PHOTO: AP

A lack of hard currency has also led to delays in the arrival of fuel shipments, leading to more extended power cuts around the country, in some areas reaching more than 12 hours a day.

The dollar briefly traded at LBP10,000 on Tuesday afternoon. The previous record was registered in July, when the dollar briefly sold for LBP9,900 on the black market. The official price remains LBP1,520 pounds to the US dollar.

Lebanon has been hammered by one crisis after another, starting with the outbreak of anti-government protests against the country’s corrupt political class in October 2019.
Lebanon has also been in desperate need for foreign currency but international donors have said they will only help the country financially if major reforms are implemented to fight widespread corruption, which has brought the nation to the brink of bankruptcy.

The drop in the value 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.

Local media reports hinted that some lenders had to collect hard currency from the black market, increasing demand for the greenback over the past days ahead of the
February 28 deadline.

“The dollar is equal to LBP10,000 pounds. People are hungry, prices are flying and there is no electricity,” tweeted Lebanese business writer Hala Saghbini.

The crash in the local currency will throw more people into poverty. In Lebanon, the minimum wage is LBP675,000, or about USD67 a month. Before the protests broke out in 2019, the minimum wage was about USD450 per month.

The crisis has driven nearly half the population of the small country of six million into poverty. In December, the World Bank warned that Lebanon’s economy faces an “arduous and prolonged depression” with the gross domestic product (GDP) projected to plunge by nearly 20 per cent.