Lebanon has gone from being an international basket case to having one foot in the morgue. It truly is a royally screwed-up country with hyperinflation, a dramatic loss in value of the nation’s currency, and a hopelessness among the people that could easily break out into revolution at any moment.
The Central Bank has ordered an end to fuel subsidies as the run on dollars has drained the treasury of hard currency. Two years ago, a dollar could buy 1,000 Lebanese lira. Today, it’s 23,000 and rapidly rising. The currency has lost 90 percent of its value in that time.
The end to fuel subsidies means gasoline is now priced out of reach of most Lebanese. To forestall unrest, the government has stationed troops at gas stations hoping to discourage looters.
The Central Bank’s governor, Riad Salameh, hit back at government charges that he acted alone and without authority to end the subsidies.
In an interview broadcast on Saturday, Riad Salameh said the government could resolve the problem quickly by passing necessary legislation.
He denied he had acted alone in declaring an end to the subsidies on Wednesday, and said it was widely known that the decision was coming. read more
“So far you have nobody running the country,” Salameh told Radio Free Lebanon.
The worsening fuel crisis is part of Lebanon’s wider financial meltdown. Hospitals, bakeries and many businesses are scaling back operations or shutting down as fuel runs dry.
It’s almost comical watching Lebanese politicians refuse to take responsibility for the catastrophe. The president, Michel Aoun, a Christian, wants a crisis meeting of the cabinet to discuss the fuel crisis. The prime minister, Hassan Diab, a Sunni Muslim, is refusing. And the Shiite speaker of parliament, Nabih Berri, is criticizing both of them.
Meanwhile, people are going to begin starving to death in a matter of weeks.
The government has said fuel prices must not change. Fuel importers say they cannot import at market rates and sell at subsidised rates, and want clarity.
The central bank and oil authority told importers to sell their stocks at the subsidised rate of 3,900 pounds to the dollar, prioritising hospitals and other essential functions.
Lebanon’s army said on Saturday it had begun raiding closed petrol stations and distributing stored gasoline to citizens.
Critics of the subsidy scheme say it has encouraged smuggling and hoarding by selling commodities at a fraction of their real price.
Politics and religion can be a deadly combination, as it is proving to be in Lebanon.