Social unrest grips Lebanon after pound plunges

Social unrest grips Lebanon after pound plunges
Drivers wait as traffic is brought to a hault in front of the interior ministry and the central bank on February 15, 2023, by a sit in staged by taxi drivers to show discontent due to the rising cost of living and the continuing devaluation of the Lebanese Lira. (AFP)
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Updated 15 February 2023

Social unrest grips Lebanon after pound plunges

Social unrest grips Lebanon after pound plunges
  • Gunmen in Tripoli force shops to close, roads blocked in Beirut and rural areas

BEIRUT: A sudden fall in the value of Lebanese pound has sparked confusion in the markets, widespread anger on the street and warnings that people “can no longer afford to buy anything.” 

The exchange rate in the parallel market reached 77,000 pounds to the dollar on Wednesday, less than 24 hours after it fell to 68,000 per dollar, creating a huge discrepancy between purchase and sale prices.

Gas station owners refused to sell fuel, while government officials tried to head off protest attempts for fear of unprecedented chaos on the street.

The threat of civil unrest was highlighted by General Labor Union President Bechara Al-Asmar, who said that the union “has received information about the possibility of rioters entering the line of action.”

His comments came after gunmen in Tripoli fired in the air to force shops to close, while protesters took to the streets in Beirut and rural areas, blocking roads in anger at the alarming deterioration in their living conditions.

“What happened today in Tripoli as a result of people taking to the streets is something that makes one cry,” Al-Asmar told Arab News.

“The same happened in Beirut and Al-Awzai area at the southern entrance to Beirut, which foretells a social explosion.”

He added: “There are hidden hands that are deepening the collapse. What is the justification for the 100 percent collapse of the (Lebanese) pound today? Nothing has changed in the economic reality to cause this collapse at a tremendous pace.”

Khaled, an activist involved in the protests, said that the latest currency plunge meant people “can no longer buy anything.”

He added: “We will study the next steps of the protests. Today, all exchange shops in the city were closed and all illegal roving money changers were expelled.”

Gas stations stopped selling petrol due to the instability of the exchange rate.

The Syndicate of Gas Station Owners in Lebanon called on caretaker Energy Minister Walid Fayyad to “issue a price-fixing table for the dollar for a limited period until the situation stabilizes, as it is in the interest of citizens and owners of gas stations alike.”

George Brax, a member of the Syndicate of Gas Station Owners, said that the daily price-fixing table for fuel prices issued by the Ministry of Energy “no longer corresponds to reality.”

The fall in the value of the pound will affect not only fuel prices, but also other consumer goods, he said.

“Our lives need dollars, as we are a country that depends on imports,” he said.

After meeting station owners at noon, Fayyad confirmed that “the ministry is working on a platform to issue more than two tables per day, in line with the fluctuation of the exchange rate.”

He added: “But we will not price gasoline in dollars and we will not violate the law. According to the consumer protection law, the fuel must reach citizens in Lebanese pounds.”

British Ambassador to Lebanon, Hamish Cowell, on Wednesday warned of the fallout from the cost-of-living crisis “if all the parties in Lebanon do not agree on electing a president and starting the reform process.”

The British diplomat said that “Lebanon is an important country for Britain and the whole world, and preserving its security and stability is necessary because it represents a model for the coexistence of religions and sects.”