Lebanon markets keep an eye on serious measures to rein in dollar

People walk past closed or half-open shops in the popular market of the Burj Hammoud neighbourhood of Lebanon's capital Beirut on December 14, 2021. (AFP)
People walk past closed or half-open shops in the popular market of the Burj Hammoud neighbourhood of Lebanon's capital Beirut on December 14, 2021. (AFP)
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Updated 29 May 2022

Lebanon markets keep an eye on serious measures to rein in dollar

People walk past closed or half-open shops in the popular market of the Burj Hammoud neighbourhood of Lebanon's capital Beirut.
  • Parliament speaker focused on renewing his term while Lebanon races against ‘big collapse,’ national bloc says

BEIRUT: The dollar exchange rate continued its fall on the black market in Lebanon on Saturday, recording 27,650 pounds against the dollar, a drop of 11,000 pounds in less than 18 hours.

The drop was a way of easing people’s anger and calming the markets a few days before the newly elected parliament convenes on Tuesday to elect a speaker, a deputy speaker and the parliamentary committees.

The Lebanese National Bloc said that Parliament Speaker Nabih Berri was focused on renewing his term, while the country was racing against what it termed as “a big collapse” and the health sector was warning of the imminent collapse of hospitals.

Berri is expected to win reelection for the sixth time, despite opposition from Christian parties and opposition parliamentary blocs.

Berri should receive around 60 votes from members of his bloc, Hezbollah’s deputies and his allies’ deputies, far less than the 98 votes out of 128 he obtained in the previous parliament.

BACKGROUND

The central bank governor has asked banks to keep their branches and funds open until 6 p.m. for three consecutive days from Monday to meet citizens’ requests to buy dollars at the Sayrafa price.

One political observer said that the position of deputy speaker, which is reserved for an Orthodox deputy, had almost been secured for MP Elias Bou Saab from the Free Patriotic Movement bloc, although the bloc refuses to vote for Berri as speaker.

On Friday, the dollar exchange rate exceeded 38,000 pounds, creating unprecedented chaos in all sectors and leading to popular anger.

The dollar rate started to decrease rapidly after central bank governor Riad Salameh announced on Friday that individuals and institutions are able buy dollars from banks at the Sayrafa rate on a daily basis.

Commercial markets witnessed a state of shock on Saturday. Some shops stopped selling goods as they waited to see if the dollar rate would stabilize at the beginning of next week.

An employee in a private company said that she converted her LBP salary when the dollar rate was at its peak on Friday, fearing that it might lose more of its value if she kept the sum in Lebanese pounds.

However, the significant drop of the exchange rate by 10,000 Lebanese pounds on Friday night shocked her, as the value of her salary significantly depreciated.

Finance Minister Youssef Khalil estimated the black market exchange volume at $5 million per day.

The trading volume on the Sayrafa platform exceeds tens of millions of dollars per day, he said.

“This means that the incontrollable increase of the dollar rate is not normal, which supports the hypothesis that some people would create this exchange rate gap and are responsible for the high black-market exchange rate for political and commercial reasons or to create panic in markets.”

Economic expert Walid Abou Sleiman said that the central bank was intervening in the market to absorb the money supply in Lebanese pounds to prevent speculation and to reduce the margin in the financial market — namely the Sayrafa platform — where the rate exceeded 12,000 Lebanese pounds.

This procedure might be temporary, and contributes to the decrease of the dollar rate, he said, but added: “What matters is sustainability.”

Abou Sleiman said that “combating speculation does not happen through these procedures, but through a central platform that limits the trading for purchases and sales.”

The central bank governor has asked banks to keep their branches and funds open until 6 p.m. for three consecutive days from Monday to meet citizens’ requests to buy dollars at the Sayrafa price.

The governor’s circulars are postponing the “explosion for a few days,” the Lebanese National Bloc pointed out.

The bloc believes that the “collapse scenario could have been avoided if the needed reforms to restructure debt and the banking sector had been applied, in addition to taking the necessary decisions to unify the exchange rate and strengthen the administrative and judicial surveillance.”

The bloc also believed it could have also been avoided if Prime Minister Najib Mikati’s Cabinet had not waited until its last session to propose its financial rescue plan in an attempt to circumvent the people and the international community, when throughout its mandate, it was busy protecting cartels and bankers.

“The solution is to elect the parliament bodies and committees within the next week and start the electoral consultations to form a rescue government that does not adopt sectarian allocation,” it said.

It called for implementing the financial reforms requested by the IMF and the formulation of an integrated plan to strengthen the economy.


France repatriates 35 children, 16 mothers from Syria camps

France repatriates 35 children, 16 mothers from Syria camps
Updated 54 min 23 sec ago

France repatriates 35 children, 16 mothers from Syria camps

France repatriates 35 children, 16 mothers from Syria camps
  • Minors were handed over to child protection services while the mothers would face judicial proceedings

PARIS: France has repatriated 35 children and 16 mothers from camps in Syria where family members of suspected Daesh terrorists have been held, the foreign ministry said in Paris.
“France has today undertaken the return to the country of 35 French minors who were in camps in northeast Syria. This operation also includes the return of 16 mothers from these same camps,” a statement said, adding that the minors were handed over to child protection services while the mothers would face judicial proceedings.


Israeli PM to press France on Iran, warn Hezbollah ‘playing with fire’

Israeli PM to press France on Iran, warn Hezbollah ‘playing with fire’
Updated 05 July 2022

Israeli PM to press France on Iran, warn Hezbollah ‘playing with fire’

Israeli PM to press France on Iran, warn Hezbollah ‘playing with fire’
  • France is among world powers trying to revive a 2015 nuclear deal with Iran
  • Iran has itself been in breach of the deal, ramping up projects with bomb-making potential

JERUSALEM: Israeli Prime Minister Yair Lapid will press French President Emmanuel Macron on Tuesday for a tougher and time-limited tack on the Iranian nuclear negotiations, and warn that the Tehran-backed Hezbollah group is “playing with fire,” an official said.
Lapid’s visit to France, his first abroad since becoming caretaker premier last week, is also a chance to flex diplomatic muscles as Israelis gear up for a snap election in November.
France is among world powers trying to revive a 2015 nuclear deal with Iran that the previous US administration quit and which Israel opposed, deeming its caps insufficient.
As Lebanon’s former colonial administrator, France has additional clout in Beirut — whose economic crisis-hit leaders were jarred on Saturday when Israel shot down three Hezbollah drones launched toward one of its Mediterranean gas rigs.
“The French are very, very active on the Iranian issue,” a senior Israeli official told reporters.
“It is important for us to make our case ... Israel opposes a return to the JCPOA (2015 nuclear deal). In the same breath, we do not oppose a deal. We seek a very strong deal.”
Israel is not a party to the nuclear negotiations. But Western capitals have been attentive to its worries about its arch-enemy and worried it might take preemptive military action if it deems diplomacy a dead end.
Since the US walkout, Iran has itself been in breach of the deal, ramping up projects with bomb-making potential — though it denies having such designs. Its technical advancements have set a ticking clock on the so-far fruitless negotiations.
“We want an end to the unending talks,” said the senior Israeli official, calling for “coordinated pressure” on Iran and offering help on “drafting an appropriate framework” for that.
Israel has de facto front with Iran in Lebanon, home to Hezbollah. The senior Israeli official, alluding to Saturday’s shoot-downs, accused the group of “playing with fire.”
The official declined to elaborate on that warning, but said Lapid would share with Macron “new material explaining how Hezbollah is endangering Lebanon.”
Hezbollah and Israel fought a war across Lebanon’s border in 2006 but have been in a largely stable standoff since.
The Karish rig near Lebanon’s coast will produce gas not only for Israel, but eventually also for the European Union, the official said, tapping into EU countries’ quest to replace Russia as an energy supplier since it invaded Ukraine.


Egypt FM in London to inaugurate partnership council

Egypt FM in London to inaugurate partnership council
Updated 04 July 2022

Egypt FM in London to inaugurate partnership council

Egypt FM in London to inaugurate partnership council

CAIRO: Egypt’s Foreign Minister Sameh Shoukry headed to London to inaugurate the first partnership council between his country and the UK.

The council will be co-chaired by Shoukry and British Foreign Secretary Liz Truss. It will include political consultations and discussions on economic and trade issues, with the participation of British Trade Policy Minister Penny Mordaunt.

A spokesman for Egypt’s Foreign Ministry said the launch of the council comes in light of strengthening cooperation between the two countries in various fields.

While in London, Shoukry met with Lord Tariq Ahmad, British minister for South Asia, North Africa, the UN and the Commonwealth, to discuss bilateral relations.


Woman stabbed by husband in front of court in Jordan

Woman stabbed by husband in front of court in Jordan
Updated 04 July 2022

Woman stabbed by husband in front of court in Jordan

Woman stabbed by husband in front of court in Jordan
  • The woman, who was rushed to the hospital and admitted to the intensive care unit, was listed in fair condition.

AMMAN: A woman was stabbed by her husband in a public street in Karak in front of the Karak Sharia Court on Monday, according to a Jordanian security source.

The unidentified man pulled out a knife and stabbed his wife in the back, chest and right hand, according to a source at Al Karak Public Hospital.

She was rushed to the hospital shortly after and admitted to the intensive care unit. She was described as in fair condition.

The attacker has since been apprehended, and police are currently investigating the incident.

According to eyewitnesses, family disputes between the couple led them to review the case at Sharia court before the situation escalated and the husband attacked the victim.

Following the death of 18-year-old Iman Ersheid, who was shot dead on campus, public outrage in Jordan has fueled calls for the death penalty to be enforced in such cases.

Last week, the High Criminal Court in Jordan sentenced a 50-year-old to death for stabbing his ex-wife before the Northern "Rusaifa" Sharia Court in a similar incident.


US offers cash rewards to curb Iran smuggling

US offers cash rewards to curb Iran smuggling
Updated 05 July 2022

US offers cash rewards to curb Iran smuggling

US offers cash rewards to curb Iran smuggling
  • Navy targets weapons and drugs in Arabian Gulf and Red Sea

JEDDAH: The US Navy is offering cash rewards of up to $100,000 for information leading to the interception of smuggled weapons and narcotics in the Arabian Gulf and the Red Sea.

The initiative by the Bahrain-based 5th Fleet does not directly name Iran but analysts said it was clearly aimed at curbing the flow of Iranian arms to the Houthi militia in Yemen and restricting the lucrative regional drugs trade operated by the Islamic Revolutionary Guard Corps.
“Any destabilizing activity has our attention,” 5th Fleet spokesman Cmdr. Timothy Hawkins said. “Definitely we have seen in the last year skyrocketing success in seizing both illegal narcotics and illicit weapons. This represents another step in our effort to enhance regional maritime security.”
Operators fluent in Arabic, English and Farsi will staff a phone hotline, and the Navy will also take tips online in Dari and Pashto. Payouts can be as high as $100,000 or the equivalent in vehicles, boats or food for tips that include information on planned attacks targeting Americans.
Asked whether new seizures could increase tensions with Iran, Hawkins listed the weapons and drugs the Navy hoped to intercept under the program. “That’s what we’re after,” he said. “That’s not in the interest of regional stability and security.”

Opinion

This section contains relevant reference points, placed in (Opinion field)

The fleet and its allies seized $500 million in drugs alone in 2021, more than the four previous years combined, and intercepted the shipment of 9,000 weapons, three times the number in 2020.
Despite a UN Security Council arms embargo on Yemen, Tehran has long been transferring rifles, rocket-propelled grenades, missiles and other weapons to the Houthis in Yemen. UN experts have examined missiles aimed at civilian targets and oil infrastructure in Saudi Arabia and traced the components back to Iran.
The rewards program is the latest initiative under 5th Fleet Vice Adm. Brad Cooper, who also launched a drone task force last year amid rising tension with Iran. The US Navy and Revolutionary Guard naval forces have had several encounters in the Strait of Hormuz.
The Houthis said last week they were monitoring increased US activity in the Red Sea and Arabian Gulf.“Because of this, defense and confrontation options are open,” a spokesman said.