First modification: 08/15/2021 – 05:14
This Saturday the President of Lebanon, Michel Aoun, urged Parliament to take measures to solve the crisis unleashed after the Central Bank announced on August 11 that it would stop subsidizing fuel imports. Hundreds of people protest, dozens of businesses close and the country’s main hospital announced that it will have to close its services this week, due to the impossibility of having energy.
Uncertainty, violence, blockades, protests, business and hospital closures are part of the worsening of the multifaceted crisis in Lebanon. The country is sinking into a new scenario that does not give respite to its population.
The country’s crippling political and economic crisis suffered a new blow last Wednesday when the president of the Central Bank announced that he will end subsidies on fuel imports, which will mean an increase in prices.
This is the latest twist in a dire situation that has plunged the Lebanese pound by 90% in less than two years and driven more than half the population into poverty.
This Saturday, President Michel Aoun asked Parliament for an emergency meeting to take appropriate measures after the Central Bank’s decision to end fuel subsidies, due to the critical state of its foreign currency reserves.
Aoun asked the president of the Lebanese Legislative, Nabih Berri, to convene a House session to “find a solution to the decision to lift subsidies” of fuel, after his first attempt failed with the interim prime minister, Hasan Diab, according to a statement from the Presidency.
The worsening fuel crisis is part of Lebanon’s broader financial collapse. Hospitals, bakeries, and many businesses are downsizing or shutting down as fuel runs out.
Violence has erupted at fuel stations, protesters have blocked roads and several tanker trucks have been hijacked this week.
In addition, officials from the country’s main private hospital, the American University Beirut Medical Center, reported that they would be forced to shut down starting next Monday, due to a shortage of fuel, used to generate electricity.
“This means that ventilators and other life-saving medical devices will stop working. Forty adult patients and 15 children living with respirators will die immediately,” hospital authorities said in a statement.
The Central Bank explains its reasons for stopping subsidies
The bank has subsidized fuel and other vital imports by providing dollars at exchange rates below the real price of the Lebanese pound. Most recently at £ 3,900 to the dollar, compared to parallel market rates above 20,000.
This situation has consumed a foreign exchange reserve that, according to the president of the Central Bank, Riad Salameh, now amounts to 14,000 million dollars.
To continue providing the grants, the bank representative assures that legislation is necessary that allows the use of the mandatory reserve, a portion of the deposits that must be preserved by law.
“We are telling everyone: they want to spend the mandatory reserve, we are ready, give us the law. It will take five minutes,” said Salameh.
However, the Government has indicated that fuel prices should not change. Fuel importers claim that they cannot import at market prices and sell at subsidized prices.
Salameh claimed that the bank had been forced to finance merchants who did not bring their product to market and that more than $ 800 million spent on fuel imports in the past month should have lasted three months. He assured that there is no diesel, gasoline or electricity. “This is a humiliation for the Lebanese,” he added.
Finding a solution in this matter seems an impossible task in a country where politicians have not been able to agree on a new government to make the decisions, since Prime Minister Hassan Diab resigned last August, forced by strong discontent. social after the deadly explosion in the port of Beirut months before. Since then, he has remained the acting ‘premier’.
Salameh indicated that Lebanon could emerge from its crisis if a reform-minded government took office.
With Reuters, AP and EFE