The value of the Lebanese currency ( the Lira ) against the US dollar dropped again to an unprecedented level on the black market on Monday , when it traded 29,000 to the dollar a record low.
According to experts , as long as the situation remains the same, the price of the dollar will continue to rise against the pound .
The Lebanese pound was pegged to the dollar at a rate of 1507.5 LBP to the dollar and until 2019 the dollar was trading at about 1500 LBP .
The wages of the majority of people in Lebanon are paid in Lebanese pounds , the drop to 29,000 means they have lost over 95% of their income , while at the same time inflation is an all time high in Lebanon since goods are priced at the black market price of the pound .
Commenting on the collapse of the Lebanese one economist was quoted as saying that “in Lebanon, everything is bad, and it is natural that the dollar price continues to rise because there is nothing to stop the lira from falling and he projected an exchange rate of 40, 000 LL to the dollar ifLebanon does not strike a deal very soon with the International Monetary Fund 9 ( IMF)
Negotiations with the IMF started in May 2020, but after two months they stalled amid arguments over the size of financial losses.
Talks resumed in September this year after the formation of a new government headed by Prime Minister Najib Mikati and they have since agreed that financial sector losses amount to around $69 billion, according to Deputy Prime Minister Saade al-Shami, who is leading Lebanon’s IMF negotiation team.
Four out five Lebanese are living under the U.N.’s poverty threshold as a result of the financial collapse
“Whoever has the possibility buy dollars and don’t not sell them ” another economist Louis Hobeika , was quoted as saying last December
He added : “I previously advised those who have dollars not to sell them ” , he added stressing that as long as the Central Bank continues to print Lebanese pounds , its value will keep going down
The recent drop in the value of the Lebanese pound came after the central bank raised the official bank exchange rate to depositors from 3900 LL to 8000 LL, which represents a haircut of 70 % based on the black market rate.
According to an October 2021 report in Eurasia , Baria Alamuddin , a very well respected Lebanese journalist wrote : “evidence of Lebanon’s impending collapse piles up by the day: About 230,000 citizens emigrated in the first four months of 2021 alone, a disproportionate number of whom are Christians. About 40 % of Lebanon’s doctors and 30 % of its nurses have departed; with comparable levels among teachers, lawyers, entrepreneurs and other professionals. More are looking to flee as the nation totters on the threshold of civil war, relinquishing all hopes of meaningful, rewarding futures in their beloved homeland, ”