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Sat, 14 Dec 2019 19:18 GMT

Lebanon: Back to Square One, Schools and Banks Closed Down Again


Reem Leila

Tue, 12 Nov 2019 20:59 GMT

In a new wave of disorder, Lebanese banks and schools closed down again on November 12th over security and safety concerns, as protests have escalated because until now political elites are still arguing the formation of the new government. Almost a month has passed since protests first erupted in Lebanon on October 17th against government’s corruption. Protests were triggered by extra taxes imposed over Whatsapp along with other messaging applications heavily used by Lebanese. Banks branches were closed as banks staff felt threatened by customers demanding access to their money and protesters who have gathered at banks

Lebanon is in dire need for the formation of a new government in order to adopt and implement emergency economic measures to rescue the country from its current crisis, as there are escalating worries over the slowdown in payments for imports of people’ daily and basic necessities.

According to Euronews website, Association of Banks in Lebanon held an emergency meeting on November 11th where they discussed the demand of the Federation of Syndicates of Banks Employees to shut down the banks. After the meeting the association issued a statement in which it denounced the abuse which banks employees were exposed to that extended to physical attacks by bank customers.

LBC International website revealed, Federation of Syndicates of Banks Employees which represent around 11,000 employees issued a statement after their meeting where it read, banking sector witnessed over the few days unstable situation that led to unacceptable working conditions, especially that bank customers were physically attacking employees, thus causing chaos at several bank branches and raising concerns over their own safety among colleagues who continued performing their duties. Some bank depositors were going in to the banks while holding guns and pistols and security employees were afraid from addressing them. "We call on the employees to abide by our decision," read the statement.

Asharq Al-Awsat reported, Lebanon's financial crisis has exacerbated since protests erupted last month, as banks closed down for almost two weeks. Immediately after banks opened its doors for costumers on November 1st depositors rushed to banks either to withdraw or transfer US dollars abroad, while the country's various lenders have imposed varying capital controls that differ from bank to bank, thus stimulating the mayhem.

A sluggish local economy and a slowdown in cash injections from Lebanese abroad have put pressure on the central bank’s foreign currency reserves throughout the past few years. Lebanese Central Bank Governor Riad Salameh noted, the central bank hoped for a swift formation of Lebanon’s new government in order to put an end to the country’s current crisis. “Bank deposits were secure and it is able to maintain the stability of the pegged Lebanese pound,” he added. Foreign currency exchange dealer said a dollar is exchanged for 1,900 Lebanese pounds, around the level cited on Friday when banks were last open and around 30% weaker than the official pegged rate of 1,500 pounds. The central bank had the capabilities to defend the currency peg.

“The Central Bank would seek to bring down interest rates through liquidity management measures. It has also asked banks to review restrictions imposed by commercial banks,” he added.

According to Reuters, President of the Federation of Syndicates of Bank Employees George Al-Hajj pointed out that ATM machines will be loaded with money so that customers would not suffer from our strike. “The strike period is yet unidentified, but banks will continue closing, until everything is stabilised and back to normal,” explained Al-Hajj.

Middle East