Lebanon’s embattled central bank governor has announced it will set the Lebanese pound exchange rate to US dollar at 38,000 LL on its Sayrafa trading platform after the local currency crashed to record lows on the parallel market on Monday.
The Sayrafa platform is one of several exchange rates in Lebanon, which is grappling with one of the worst economic crises in modern history. The Sayrafa rate stood at 31,200 on December 23, the last day of trading before the Christmas break.
Lebanon’s official rate remains at about 1,500 pounds per dollar, a value that is meaningless amid a more than 95 per cent fall since the financial collapse that first became apparent in 2019.
The Dollar black market rate hit 48,000 LL on Monday, which the Banque Du Liban blamed on currency speculation and the smuggling of US dollars outside Lebanon.
“This rise caused inflation in the markets, which harmed the Lebanese citizen, since prices in Lebanon are linked to the exchange rate of the dollar,” the BDL said.
After the central bank announcement on Tuesday, the dollar was trading at about 43,000 Lebanese pounds.
The BDL said it was also opening currency trading at the new rate to all individuals and institutions, and removing a $400 monthly limit.
The Sayrafa app was introduced last year in a bid to limit the power of black market exchanges.
The economic crisis has pushed many in Lebanon into poverty, with severe shortages of basic essentials including clean water, electricity and medicines.
A political vacuum has delayed the implementation of desperately needed reforms so Lebanon can receive billions in dollars of bailout money from the International Monetary Fund.
Lebanon has been without a president since Michel Aoun departed office at the end of October, while Prime Minister Najib Miktati’s caretaker cabinet has been stripped of most of its powers.
Salameh Corruption probe
BDL Governor Riad Salameh is being investigated over his financial dealings in at least five European countries. He denies accusations of corruption.
European investigators will visit Lebanon in January as part of a cross-border probe into alleged fraud by Lebanese central bank governor to the detriment of the Lebanese state, three judicial sources said.
As the head of the Banque Du Liban since 1993, Mr Salameh is seen by many as a key figure in the country’s financial downturn.
Several Banks refuse to sell Dollars at the 38,000 LL rate
Salameh on Wednesday said citizens can head to any AMBank branch to carry out Sayrafa currency exchanges at the LBP 38,000 rate should their bank refuse to conduct the transaction.
Salameh’s move comes after the owners of fuel stations and distributors complained that they have not been able to buy dollars from commercial banks at the new ate. The majority of stations closed across Lebanon because they could not buy fuel .
Salameh, who was accused of limiting the special exchange rate to AM Bank only called on “banks willing to take a similar step ( As AM Bank) to submit a request to the central bank so that it gets approved.”
AM Bank (or Al-Mawarid Bank) is a Lebanese medium-size bank that was established in 1980. According to leaked documents obtained by OCCRP ( ORGANIZED CRIME AND CORRUPTION REPORTING PROJECT , Salameh’s son Nady was able through AM Bank to transfer over $6.5 million out of the country in 2020 ( right after the Beirut Port blast) while banking restrictions blocked ordinary citizens from accessing their savings and a financial crisis shredded the value of their deposits. During the same period the AM Bank owner ( Mr Kheireddine ) was able to transfer $10 million to US to buy an apartment in Manhattan from a US actress
News Agencies
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