Ya Libnan

Salameh: New wages will raise inflation in Lebanon

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Central Bank Governor Riad Salameh told OTV on Tuesday that the cabinet’s latest decision to raise the minimum wage would raise inflation in Lebanon.

Commenting on whether the new wages will negatively affect the exchange rate of the Lebanese lira he said the exchange rate (of the Lebanese lira) is to fixed to the US dollar according to the Central Bank’s policy.

The cabinet voted on Wednesday to increase the minimum monthly wage from 500,000 LL to 868, 000 LL or about 74 %. The increase was based on a proposal presented by Minister of Labor Charbel Nahhas who represents the Free and Patriotic Movement (FPM) in the cabinet

Lebanon Information Minister Walid Daouq said following the cabinet meeting last Wednesday that the ministers also agreed to increase the daily minimum wage to 33,000 LL and introduce a minimum monthly transportation allowance of 268,000 LL.

Daouq also said that salaries less than LL1.5 million will be increased by 18 percent while salaries between LL1.5 million and LL2.5 million will be increased by 10 percent. Wages above LL2.5 million will receive a lump sum increase of LL370,000

The new wages are retroactive to December 1, 2011.

The current exchange rate of the Lebanese Lira 1500 LL to one US Dollar

Many analysts fear that the new wage increase would be quickly offset by inflation.

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4 responses to “Salameh: New wages will raise inflation in Lebanon”

  1. 5thDrawer Avatar
    5thDrawer

    Since it seems one cannot exchange Leb Lira anywhere in the world generally, how does the Lebanon Central Bank set it’s rate VS the constantly-changing-on-world-markets US dollar? Or any other currency?
    Is everyone waiting to see that ‘retroactive’ pay? 😉  The inflation has already occurred.

  2. Avatar
    Anonymous

    Since it seems one cannot exchange Leb Lira anywhere in the world generally, how does the Lebanon Central Bank set it’s rate VS the constantly-changing-on-world-markets US dollar?
    Is everyone waiting to see that ‘retroactive’ pay? 😉  The inflation has already occurred.

  3. Rafic Avatar
    Rafic

    Where were you all this time Governor Salameh . Why you did not advise all parties concerned about this dillema now they will lock horns. Of course inflation is going to take off and the employers will raise all prices and the public ends up paying more.

  4. Avatar
    Anonymous

    Where were you all this time Governor Salameh . Why you did not advise all parties concerned about this dillema now they will lock horns. Of course inflation is going to take off and the employers will raise all prices and the public ends up paying more.

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