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Symptoms of collapse have begun “getting stronger” With the Central Bank of Lebanon announcing that its foreign exchange reserves fell below $ 10 billion, to $ 9.72 billion at the end of August 2022.
Why have precautions decreased?
• As revealed by banking expert Nassib Ghobril in an interview with the site “Sky News Arabia”precautions drop Lebanon of foreign exchange reflects the pressure on the Central Bank and the countless requests for precious money to cover imports of fuel, grain and some medicines.
• This decline also comes after the application of circulars that have made it easier for depositors to withdraw cash dollars from their bank accounts.
Gabriel reveals that the Lebanese Central Bank’s foreign exchange reserves have fallen by $ 3.1 billion from the beginning of 2022 until the end of August, despite the bank’s steps to find sources to replenish its hard currency reserves. .
continuous bleeding
And Ghobril expected the continued drain of hard currencies from reserves, in light of the almost complete shutdown of the traditional sources that fed them, such as the flow of deposits to the banking sector and the issuance of bonds. “Eurobonds” Andforeign direct investments.
And Gabriel believes that, despite the decline in reserves to a low level, the Banque du Liban will not stop its market intervention through the platform for now. “banking” Which determines the dollar exchange rate, but what it will do is limit it by setting caps for selling dollars through the platform.
It has already begun to implement it by reducing the percentage of dollars allocated to finance the import of gasoline to only 20 percent, while importers have to secure 80 percent of the parallel market.
Former Deputy Governor of the Banque du Liban, Ghassan Ayyash, said the drop in the volume of Lebanon’s foreign exchange reserves below $ 10 billion means that the Banque du Liban is in the last phase of support, noting that there is not much time left before the bank was forced to suspend any form of support it provides.
Ayyash was surprised in an interview with the website “Sky News Arabia”Some have said that the drop in reserves below $ 10 billion means that the Banque du Liban has crossed the red line, pointing out that “Crossing the red line began in 2015 when the bank ran out of all its reserves, and then started using its bank deposits, i.e. Money of depositors“.
Unmatched problem
According to Ayyash, the liabilities of the Banque du Liban are more than the assets and”Therefore, we are facing a similar monetary and banking problem”He asked to focus on a medium-term economic plan in coordination with the International Monetary Fund to get out of the crisis, return most of the deposits and force the political class to commit to a real program of reforms.
The banking expert found that “The aim of this global operation is to revive the Lebanese economy in order to emerge from its deadly crisis”as he said.
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Indications of the collapse began to “raise in severity” with the announcement by the Central Financial institution of Lebanon that its foreign exchange reserves fell to considerably less than $ 10 billion, reaching 9.72 billion at the finish of August 2022.
Why have safety measures lessened?
• As revealed by banking qualified Nassib Ghobril in an interview with “Sky Information Arabia”, the decline in reserves Lebanon of foreign exchange demonstrates the force on the Central Lender and the countless requests for important cash to include imports of gasoline, grain and some medicines.
• This decline also comes soon after the application of circulars that have manufactured it less difficult for depositors to withdraw dollars dollars from their lender accounts.
Gabriel reveals that the overseas trade reserves of the Central Lender of Lebanon have lowered by 3 billion and 100 million bucks from the beginning of 2022 until eventually the finish of August, irrespective of the measures taken by the financial institution to uncover sources to replenish its international exchange reserves. potent.
steady bleeding
Ghobril foresaw the continuation of the drainage of tough currencies from reserves, in mild of the virtually entire quit of the common sources that fed them, these kinds of as the move of deposits to the banking sector and the issuance of Eurobonds, andforeign direct investments.
Gabriel thinks that regardless of the drop in reserves to a reduced amount, the Banque du Liban will not at the moment stop its sector intervention via the “trade” platform that determines the dollar exchange charge, but fairly what it will do is restrict it. by environment the caps for income in bucks via the system.
It has already begun to put into practice it by minimizing the share of dollars allotted to finance the import of gasoline to just 20 p.c, though importers have to protected 80 % of the parallel industry.
Previous Deputy Governor of the Banque du Liban, Ghassan Ayyash, claimed the fall in the volume of Lebanon’s foreign exchange reserves beneath $ 10 billion means that the Banque du Liban is in the previous section of assistance, noting that there is not significantly time still left prior to the lender was forced to suspend any variety of support it presents.
Ayyash was shocked, in an job interview with “Sky Information Arabia”, that some men and women explained that the drop in reserves beneath $ 10 billion implies that the Banque du Liban has crossed the pink line, pointing out that “the Crossing the red line began from 2015 when the financial institution ran out of all its unique reserves and then commenced using its bank deposits, eg. Funds of depositors“.
Unmatched issue
According to Ayyash, the liabilities in the Banque du Liban are additional than the assets and “thus, we are experiencing a comparable financial and banking difficulty”, inquiring to concentration on a medium-phrase financial program in coordination with the Global Financial Fund to exit the crisis , return a huge aspect of the deposits and pressure the political class to engage in a serious program of reforms.
The banking pro believed that “the objective of this world-wide procedure is to revive the Lebanese financial state in order to arise from its deadly crisis”, as he said.
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