2023-11-07 11:59:26
“Lebanon Debate”
The journalist specializing in economic affairs, Khaled Abu Shakra, saw that “since late July, with the taking over of the acting governor of the Bank of Lebanon, Wassim Mansouri, his basic condition was that he not finance the state, and as long as he insisted on not financing the state with the lira or the dollar, as long as there was the ability to control on the exchange rate.
In an interview with “Lebanon Debate,” Abu Chakra said: “When he wants to finance the state, if he decides to pay from compulsory contributions, he loses dollars, and if he decides to pay in liras, that means he will be forced to print liras to finance the state, and thus the exchange rate rises, and this is what happened with the financial crisis.” Through the increase in the monetary supply in lira from the limits of 5 thousand billion liras on the eve of the crisis, to more than 90 thousand billion liras.
He considered that “the policy adopted by Mansouri and the Central Council was able to reduce the monetary supply in pounds, and in fact it has become about 58 thousand billion pounds, and this matter greatly helps to prevent the exchange rate from becoming unstable.”
He pointed out, “This matter will not last, especially since the state during the summer period was able to increase its revenues in dollars, by raising the customs dollar, and raising the electricity and communications bill, etc., but all the increases it made cannot cover the real cost to the state.”
He stressed that “the state cannot borrow from abroad, as its revenues will not be sufficient to cover all its operational expenses, and therefore it will be forced to borrow from the Bank of Lebanon.”
Abu Chakra pointed out that “today’s exchange rate is no longer flexible, and is no longer affected, either negatively or positively, by events.”
In conclusion, he revealed that “the actual deficit in the balance of payments is two billion dollars, and this is a very large pressure on the exchange rate,” expecting that “the exchange rate will rise again, especially since there is an impossibility to carry out any required reforms and rescue plans.”
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