Lebanon’s Central Banks Burn As Protesters React To Currency Crisis

 

Lebanon is facing a currency crisis, brought on by decades of corruption and mismanagement at the highest levels of government and banking. In response to the crisis, protesters have taken to the streets in anger, and set fire to the country’s central bank, according to Foreign Policy.

Lebanese media reported that police clashed with protesters on over the weekend as the demonstrations intensified. Protests began in multiple Lebanese cities in response to a steep crash in the pound currency, which has lost about 70% of its value in the past 6 months.

Joyce Karam of United Arab Emirates-based media outlet TheNational reported June 11 that the Lebanese pound is trading for more than 5,000 per $1.

Inequality is also a major problem in the country. The top 1% receives 25% of the national income on average, and the top 10 percent receives 55% of the national income, according to data collected between 2005 and 2014.

Tripoli, Lebanon’s second-largest city, is one of the poorest areas of the country with poverty rates at around 50% near the end of 2019.

On Friday, the Lebanese central bank announced that it would inject millions of dollars into the market this week, which seemed to slightly flatten the crash, but did little to restore faith in the markets.

Meanwhile, Beirut has been holding talks with the International Monetary Fund for a reform program that it hopes will secure billions of dollars in financing to stabilize the nation’s economy. However, the IMF has a very rough track record of making bad situations worse, because impoverished countries often find themselves deep in debt with the international bank.

During recent protests in the country, banks have become a primary target for arsons and other attacks, as they are seen as the source of many of the nation’s problems.

Activists have said that they are demanding a new transitional government and will not stop protesting until those are currently in power resign.

Lebanon’s prime minister, Hassan Diab, condemned the recent protests and called them a “coup” against the government and an attempt to manipulate the value of the Lebanese pound.

On Monday, the Lebanese army announced that it arrested dozens of people for various crimes, mostly vandalism, during the protests.

“The total number of arrests made by military intelligence between 11 and 15 June in different Lebanese regions is 36 people for acts of vandalism,” an statement from the army read.

This is a situation that has been developing in the country for nearly a year, especially since October when the currency began its freefall. However, experts believe that the full force of the protests was delayed by the coronavirus lockdowns, and have now been amplified by the events of the past several months.

Lebanon is located in Western Asia. It is on the border of Syria to the north and east and Israel to the south, while Cyprus is west across the Mediterranean Sea. The country is greatly affected by the conflicts that take place just over its borders, which include the current civil war in Syria and the complicated military politics of Israel.

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