The economic journalist Emad Al-Shidyaq expressed his concerns regarding the dollarization of prices in a tweet on his Twitter account. He claimed that adopting the dollar as a standard currency will result in the collapse of state institutions, leading to their failure to pay public sector salaries in the future. Al-Shidyaq added that the exchange rate is expected to increase significantly in the coming months, given the tendency of many sectors towards adopting the dollar.
The journalist warned of a potential rise of the dollar’s rate by 20 to 30 thousand pounds per day and stated that pharmacies and gas stations are already requesting to be paid in dollars. He suggested that workers and employees might demand dollarization as well. Al-Shidyaq also argued that depriving the Banque du Liban of dollars will result in raising the exchange rate to frightening levels, making it difficult for the state to pay its employees’ salaries continuously.
Al-Shidyaq predicted that the Lebanese economy might transform into two separate economies: a “dollar economy” for those who can consume in hard currency and have their own businesses, and a “lira economy” intended for everyone who receives the Lebanese pound. He strongly asserted that it is only a matter of time before this change takes place, emphasizing the urgency of considering alternative solutions.
He added, “The exchange rate will rise a lot in the coming months as a result of the tendency of many sectors towards the dollarization of prices.”
Pricing in dollars will lead to the collapse of state institutions completely and will cause them to falter in paying public sector salaries in the future… It is only a matter of time.
The exchange rate will rise a lot in the coming months as a result of the tendency of many sectors towards the dollarization of prices.— Emad Chidiac (@emadchidiac) March 19, 2023
He continued, “I do not rule out that the dollar will rise by 20 or 30 thousand pounds per day, reaching a stage where we will lose our appetite to follow its news, because we simply will not have work with the pound and its exchange rate.”
Chidiac pointed out, “Pharmacies have begun to demand the state. Gas stations have been hovering around this demand for some time, and later workers and employees will demand dollarization.”
I do not rule out that it will rise #dollar 20 or 30 thousand pounds a day…. until we lose our appetite to follow his news, because we simply will not have work in pounds and its exchange rate.
Pharmacies have begun to demand the state, gas stations have been hovering around this demand for some time, and later workers and employees will demand dollarization.— Emad Chidiac (@emadchidiac) March 19, 2023
And he pointed out that, “Dollarization means depriving the Banque du Liban of dollars, and it will take the initiative to raise the exchange rate, as usual, to frightening levels, in order to withdraw dollars from the market.”
Chidiac considered, “Taxes will not be able to keep pace with the rises in the exchange rate, and the state will be unable to pay salaries and raise them continuously (it has begun to acknowledge this).”
Dollarization means depriving the Bank of Lebanon of dollars, and it will take the initiative to raise the exchange rate, as usual, to frightening levels, in order to withdraw dollars from the market.
Taxes will not be able to keep pace with the rise in the exchange rate, and the state will be unable to pay salaries and raise them continuously (it is beginning to acknowledge this).— Emad Chidiac (@emadchidiac) March 19, 2023
He explained, “The Lebanese economy will transform with time into two economies:
– A “dollar economy” for those who are able to consume in hard currency and have their own shops, restaurants, hospitals, gas stations, etc.
– The “lira economy” is afflicted, helpless, and is intended for everyone who receives the Lebanese pound.
Economic journalist Emad Chidiac concluded, “It is only a matter of time.”
The Lebanese economy will transform with time into two economies:
– A “dollar economy” for those who are able to consume in hard currency and have their own shops, restaurants, hospitals, gas stations, etc.
– A afflicted, helpless “lira economy” dedicated to everyone who receives Lebanese pounds.
…it’s only a matter of time.
— Emad Chidiac (@emadchidiac) March 19, 2023
In conclusion, the warnings of economic journalist Emad Al-Shidyaq about dollarization increasing in Lebanon and the potential collapse of state institutions are alarming. With the rising demand for the dollar in different sectors, the value of the pound may continue to plummet and affect the ability of the government to pay public sector salaries. The transformation of the Lebanese economy into two economies, one for those who can consume in hard currency and one for those who receive the lira, could further exacerbate the economic divide in the country. It remains to be seen what actions the government will take to address this crisis and prevent further economic deterioration.