Lebanon is experiencing a severe economic crisis. Before the Corona virus (COVID-19) pandemic in early 2020, the country was already struggling to show signs of destruction.
Quoted by the BBC, Sunday (11/7/2021), initially in early October 2019 the country was short of foreign currency, thus making the pound currency value Lebanon weakened against the US dollar.
It was also in late 2019 that the country was exposed to what analysts call a pyramid scheme or Ponzi scheme, in which the central bank owes commercial banks at interest rates above the market average. The debt is to pay off other debts and defend Lebanon.
At the same time, people are increasingly angry and frustrated at the government’s failure to provide basic services. They have to deal with daily power cuts, lack of clean drinking water, limited public health services, and the worst internet connection in the world.
The ruling elite has been the target of public anger for having dominated politics for years and amassing their own wealth, while failing to carry out the sweeping reforms needed to solve the country’s problems.
Then the unprecedented wildfires in the country’s western mountains exposed just how short Lebanon was in funding and firefighting equipment.
In mid-October, the government proposed new taxes on tobacco, gasoline and voice calls via messaging services like WhatsApp to boost revenue, but backlash forced it to scrap those plans.
All that has happened has caused a wave of discontent that has been raging in Lebanon for years. Tens of thousands of people in the country took to the streets, prompting the resignation of Western -backed Prime Minister Saad Hariri and his union government.
The protests have become a rare phenomenon since the 1975-1989 civil war that devastated the country ended, and brought the country to a close.
Newly appointed Prime Minister Hassan Diab later announced that Lebanon would default on its foreign debt for the first time in history, saying its foreign currency reserves had reached a critical and dangerous level, the rest needed to pay for urgent imports.
Then the COVID-19 pandemic made things worse. After the first deaths from the Corona virus and a spike in infections, a lockdown was imposed in mid-March 2020 to curb the spread of the virus.
On the one hand, it forced anti-government protesters off the streets. But on the other hand it made the economic crisis much worse and exposed the dilapidated social welfare system in the country Lebanon.