Lebanon’s banks reopen with strict controls in place


Lebanon’s banks reopened on Tuesday with new controls in place. Whatever grievances Lebanese have with their banks, they still can’t do without them.

Lebanon’s bank staff union announced Monday it’s ending a week-long strike after increased security and new regulations that officially limited withdrawal and dollar transfers.

The union said banks will reopen Tuesday.

Banks have been at the center of anti-government protests, as demonstrators accused them of corruption and mismanagement. 

They had closed with the eruption of protests on Oct. 17, opening only for a week. Depositors then rushed in to withdraw money, but banks had begun imposing informal capital controls that angered many clients and added to the turmoil, prompting the employees’ strike.

On Saturday, security forces said they will boost security around banks. A day later, the Banks Association declared formal controls, limiting withdrawals to $1,000 per week, and transfers abroad to “urgent matters.”

The financial crisis in Lebanon predates the protests, which were sparked by new proposed taxes, including on the free call and messaging service Whatsapp. The protests have since snowballed into calls for the government to resign and for the entire political elite that has ruled Lebanon since the end of its 1975-90 civil war to step aside.

On Monday, the U.S. State Department spokeswoman tweeted that Washington “proudly” stands with the Lebanese people who are demanding an end to endemic corruption. Morgan Ortagus posted a video recorded on Friday in which she blasted Russia for seeking to miscast the Lebanese protests as a “plot by the United States.”

A senior Russian official earlier this month said Moscow rejects “external attempts to interfere in Lebanese affairs” or foment demonstrations. He didn’t specify the United States.

“This is simply incorrect,” she said in the video. She listed U.S. assistance to the Lebanese armed forces and humanitarian aid over the past decade as proof of Washington’s support for the Lebanese people and institutions.

The U.S. has also imposed widening sanctions on the Lebanese militant group Hezbollah, which it labels a terrorist organization.

A last batch of $105 million of U.S. assistance to the Lebanese Armed Forces has not yet been transferred to the State Department account where it can be used to fund purchases of U.S. equipment.

The delay has prompted questions from Congress, which was notified in September that it would be spent. State Department officials said it is awaiting final approval from the White House before being transferred and that no shipments to the army have been affected.




Leave a Reply