Lebanese national carrier Middle East Airlines to only accept US dollars

Lebanese national carrier Middle East Airlines to only accept US dollars
Dozens of customers crowded the MEA offices at Beirut airport after the announcement. (Reuters/File)
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Updated 16 February 2020

Lebanese national carrier Middle East Airlines to only accept US dollars

Lebanese national carrier Middle East Airlines to only accept US dollars
  • Middle East Airlines (MEA) is majority-owned by the Lebanese state and administrated by the country’s central bank
  • Dozens of customers crowded the MEA offices at Beirut airport

BEIRUT: Crisis-hit Lebanon’s national carrier will only accept payments in US dollars from Monday, according to state media.
Lebanon is in the throes of an economic meltdown and a biting liquidity crunch that has seen the local currency depreciate on the parallel market and banks impose stringent controls on withdrawals and transfers abroad.
“From Monday, Middle East (Airlines) and other airline companies operating in Lebanon will only accept payments in US dollars,” the official National News Agency (NNA) reported on Sunday.
In the wake of the announcement, dozens of customers crowded the MEA offices at Beirut airport — the only one open on Sunday — in the hopes of paying for their tickets in Lebanese pounds, images broadcast on local TV showed.
Middle East Airlines (MEA) is majority-owned by the Lebanese state and administrated by the country’s central bank.
The Lebanese pound has been officially pegged at 1,507 pounds to the US dollar since 1997, and the two currencies are used interchangeably in the tiny Middle Eastern country.
But in recent months, the pound has plunged against the greenback on the parallel exchange market.
Informal currency controls imposed since late last year have sparked public outrage in the protest-hit country, where an anti-government popular movement launched on Oct. 17 has grown increasingly angry at banking policies.
Major banks in Lebanon began tightening banking controls this month, halving the amount of dollars depositors are allowed to withdraw every month.
It will still be possible to complete certain transactions — such as modifying reservations and paying for excess baggage — in local currency at Beirut airport, the NNA said, adding that travelers can pay using check or card, provided the account is in foreign currency.
MEA offices had so far continued to accept payments in pounds at the official rate and Sunday’s announcement was met with an angry response on social media.
“MEA: A national airline that does not accept payment in its own national currency. Logic redefined,” one Twitter user wrote.
Another posted in response to the news: “Middle East (MEA) belongs to the Lebanese state, it’s a flagrant violation of the law. We’re not heading for collapse, we’re in the middle of it.”
The central bank chief said in January that he agreed with money exchange houses capping the parallel rate at 2,000, but the price of dollars at some exchanges continues to rise.


Saudi PIF seeks investment flexibility with $5 billion-plus loan

Updated 04 December 2020

Saudi PIF seeks investment flexibility with $5 billion-plus loan

Saudi PIF seeks investment flexibility with $5 billion-plus loan
  • The loan finances are for use if and when the fund identifies investment opportunities 
  • PIF  is at the heart of the Kingdom’s strategy of economic diversification under its Vision 2030 reform plan

DUBAI: The Public Investment Fund (PIF), Saudi Arabia’s sovereign wealth fund, is in talks with bankers to raise a loan of between $5 billion (SR18.75 billion) and $7 billion to provide flexibility in its investment strategy.

The PIF has declined to comment on reports of the loan, said to be in the form of a revolving facility from a number of international banks, but sources said it was part of the fund’s regular financing arrangements, which have seen it take out and repay facilities for the past two years.

The loan finances are for use if and when the fund identifies investment opportunities and may not necessarily be used.

The PIF has been opportunistic during the coronavirus pandemic in identifying what it saw as undervalued assets on global stock markets and has been an active trader in securities on international markets.

The fund invested $7 billion in mainly US stocks in the first quarter of the year, when markets were first impacted by pandemic lockdowns, and increased and diversified that in the second quarter. It scaled back its commitments in the third quarter when asset values were near all-time highs. In the summer, it spent $1.5 billion to acquire a stake in the Indian digital business Jio Platforms.

PIF, under governor Yasir Al-Rumayyan, is at the heart of the Kingdom’s strategy of economic diversification under its Vision 2030 reform plan, while simultaneously building an international portfolio of assets.

Earlier this year, PIF repaid a $10 billion syndicated loan ahead of schedule after it completed the sale of its stake in SABIC to Saudi Aramco, and in 2018 it raised an $11 billion term-loan facility from international banks.

Previous fundraisings were done in partnership with a group of 10 banks from the US, Europe, and Asia that form part of the fund’s “core banking relationships.”