The lira is falling

Beirut 2/11/2019

The lira is declining, poverty is advancing, what to do?

Price chaos spread throughout the country, and merchants began to hunt unchecked. Dozens of contacts transmit daily to the association, on the hotline, the suffering of people. From labels to foodstuffs to fuel and gas. Expensiveness is spreading and people are worried about the present and the future.

With the start of financial engineering in the summer of 2016, the Lebanese economy began to become more fragile, putting the lira in the wind. Three precious years were wasted by the authority in search of imaginary solutions, including the CEDRE conference. Taxes and fees on consumption were raised and mastered in humiliating the poor people and the middle groups instead of going to urgent economic and financial reforms, the most important of which are: stopping tax evasion and customs evasion and collecting fees on public property (and we are talking about approximately six billion dollars) and stopping the organized looting of state finances and sharing them among the ruling families And the shift towards investment in the productive sectors, industry, agriculture, modern technology and infrastructure. Only this can secure a large number of job opportunities for desperate unemployed youth.

Three years during which the government insisted on continuing its failed path. I went again to raise interest and to new financial engineering that deepened the abyss. And it ended in a miserable attempt, closer to farce, to sell the WhatsApp service that it does not own. The simplest people know that this service is the only outlet for more than four million subscribers, the majority of whom are poor.

Today, the incident occurred and the authority plunged the country into a deep and dangerous crisis, the consequences of which can be predicted from now on: the decline in the purchasing power of the majority of the Lebanese people, the exacerbation of the current economic recession, and the increase in unemployment and poverty.

People have had enough of these corrupt and destructive policies and have taken to the streets. The authority’s departments hid behind closed roads, leaving the lira to banks and major merchants to take the first step: throwing the lira into the black market to reduce its value, and it fell within 10 days by about 20%. There are traders who carried the dollar higher than 2100 LL. Now, with the government's resignation, there are those who are working to take people's demands into the unknown. The lira will continue to decline in batches, which will push inflation and increase prices to levels that the country only knew during the civil war.

The collapse of the lira poses a real threat to the Lebanese society, especially when the regime allows large owners of money to flee with their money abroad. The authority does not have any serious solutions to this crisis, and it deals with it with great confusion, and the piece has the illusion of buying time.

But this is not the inevitable fate. The Lebanese can change this bleak future now. The Consumer Association addresses the Lebanese people to continue to put pressure on the authority to take possible preliminary measures, pending a new government that expresses the aspirations of the Lebanese:

1. Adopt billing in pounds in all official and private transactions, and start billing communication services in pounds according to the laws. The Minister of Communications says that a decree issued by the Council of Ministers approved the dollar instead of the pound. Does the Council of Ministers and the Minister of Communications know that the Consumer Protection Law, which stipulated in 2005 in Articles 5 and 25 of it, requires billing in pounds, and it canceled all previous laws and decisions? Add to this the monetary and credit law, which provided for the national currency. Therefore, the Minister of Communications should apply the law only and without consulting anyone, not go to a government decree that violates the laws and adhere to it. This is not a simple step, as its impact affects a basic economic sector and 4 million and 800 thousand subscribers, and it will also relieve pressure on the Lebanese pound to stabilize. The Consumer Association has been communicating for days with the Minister of Economy and the Minister of Communications with the aim of implementing the law and the law only.
2. Stabilizing the prices of goods and services on all Lebanese territories, according to September 2019 figures. The Ministry of Economy and the Central Statistics Department have complete regulations in this regard. This measure was taken by dozens of countries that experienced this type of crisis, and it does not affect the “free” economy and its sacred monopolies. The time has come for the state to intervene in limiting these monopolies that control all sectors of consumption, allowing saving billions of dollars annually. We are talking about basic sectors in oil, gas, food, medicine, aviation, cement, cars, and communications... A few have swallowed, by intermarrying with the authorities, most of the country's wealth. Yes, Lebanon is not poor, but it is plundered.
3. Immediately preventing the flight of capital in preparation for returning the looted money to the people. Every day of delay will allow the politicians, their families, and the businessmen who revolve around them to flee, fearing the crisis and fearing the accountability that might come one day.

The authority still thinks with the same mentality: deposits, deposits, and more deposits. You want to buy time not review their policies. We are reviewing policies. In order to do this quietly without the pressure of threats of capital flight, serious control measures must be taken over capital. The Banque du Liban does not want that. He says that the “Capital Control” will arrange great risks that affect the possibility of capital flowing to Lebanon for a long time. But there is nothing wrong with leaving the matter to the banks to put pressure on customers, of course, each according to his position! We disagree with this opinion because we have not seen in this flow of deposits any real development for the country for 25 years. Rather, a decline in all productive sectors, a legendary rise in public debt, and a parallel rise of the quota system and corruption.

We believe that the Lebanese want another Lebanon: with job opportunities, education, health, modern and cheap transportation and communications, water, electricity, healthy food, and a clean environment free of rubbish, pollution, and cancers. Deposits did not insure any of this. Deposits could have been a blessing, but the system of corruption turned them into a curse. Therefore, the "Capital Control" could be an entry point for new financial policies. Mechanisms can be put in place to manage these capitals according to their size in the interest of rebuilding the economy according to a new vision that the Lebanese people agree upon. Sidr money will not change anything but more corruption and debt.

The people's movement is an opportunity for Lebanon to get out of its historical crises. keep it.

Consumer Association-Lebanon

Mneimneh Street - Hamra - Lebanon. Science and news No. 104 / a. Dr

Phone: 01750650 consumerslebanon@gmail.com