100,000 Lebanese Pounds now equals to $1 US dollar

In Lebanon’s black market, the value of the Lebanese pound versus the US dollar has plummeted to an all-time low.

Officially set at 15,000 to the dollar, the Lebanese pound was, according to dealers, trading at 100,000 against the dollar, a startling decline from 1,507 when the economic crisis struck in 2019. At the end of January, the market exchange rate of the currency was at 60,000 to the greenback. Although the crisis is serious, the political class, which is generally held responsible for the nation’s financial catastrophe, has failed to stop the currency’s free decline.

Due to the ongoing parliamentary standoff between different groupings, the nation has had no president since last year and just a caretaker administration. Lebanese banks were shut down as they resumed an ongoing strike that had seen them impose harsh withdrawal restrictions that effectively locked depositors out of their life savings. The strike was in response to what the Association of Banks in Lebanon described as “arbitrary” legal actions taken against institutions after depositors filed lawsuits to recover savings. The walkout started early last month.

In response to the complaints, several judges sought to freeze the bank board members’ or directors’ assets or compel lenders to pay out clients’ dollar deposits in pounds at the previous 1.507 exchange rate.

Although caretaker Prime Minister Najib Mikati interfered late last month to obstruct the work of one of the judges probing banks, customers were granted a two-week reprieve from the strike. In response to public outcry about bank withdrawal restrictions over the past three years, some Lebanese have resorted to armed robberies to seize their own money. While ATMs have been destroyed and bank branches have frequently been closed for days at a time, many banks in the city have facades that are nearly unrecognizable from the outside due to protective metal panels. Once the pound fell to around 80,000 to the dollar in mid-February, dozens of enraged protesters attacked numerous banks in Beirut.

The Lebanese economic crisis has been characterized by political inactivity and a lack of responsibility. In exchange for releasing billions of dollars in emergency loans, officials were required to implement several reforms. None of these measures have been implemented. The International Monetary Fund stated in April of last year that it had reached a preliminary understanding to lend Beirut $3 billion over four years in exchange for a series of significant changes.

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Since divided lawmakers have been unable to elect a new president for months, Lebanon is large without a leader as it deals with the economic collapse. The country is already run by a caretaker ministry with limited authority. Since Michel Aoun’s time as president expired in October, Lebanon has not had a president. Every time a session of parliament has been called to elect a successor, no consensus candidate has been chosen.