Lebanon is sinking into a currency crisis

People in Lebanon now have to pay 17,000 lira for one dollar – of course, it can only be got on the black market. People fight over petrol at petrol stations.

People crowd with their cars and motorbikes to get fuel at a gas station in Beirut.

Dhe severe economic and financial crisis in Lebanon continues to intensify. The Lebanese lira hit a new all-time low on the black market, local media reported on Saturday. One dollar therefore cost more than 17,000 lira for the first time. The Lebanese currency has thus lost more than 90 percent of its value since the crisis broke out almost two years ago.

The collapse of the lira goes hand in hand with a supply crisis, as the Mediterranean country is heavily dependent on imports. Due to a lack of fuel, long queues form in front of gas stations every day, where exasperated drivers have to wait for hours. The Al-Joumhouria newspaper published a video showing two angry men fighting at a gas station. The caretaker government cut fuel subsidies on Friday.

60 percent of the population in poverty

The economic and financial crisis in Lebanon broke out in October 2019. It was exacerbated by the corona pandemic and the catastrophic explosion in the port of Beirut at the beginning of August. The country is one of the most heavily indebted countries in the world. Inflation is more than 100 percent, for food even more than 200 percent. More than 60 percent of the population lives in poverty.

At the same time, Lebanon does not have a government capable of acting because the main political forces have not been able to agree on a new cabinet for months. The country’s leadership faces massive allegations of corruption. Critics accuse her of having driven Lebanon into debt with a kind of pyramid scheme. Western states and the International Monetary Fund (IMF) only want to give aid if the government decides on reforms.