| 3 February 2023, Friday |

New spike in commodity prices

Lebanese are struggling to survive amid the ongoing economic crisis. Commodity prices are skyrocketing, the purchasing power is deteriorating, and several talks arising about the return of queues on gas stations. All of these circumstances prevail without any governmental decision to adjust wages, and even the transportation allowance. While the exchange rate of dollar on the black market has surpassed 22,000 LBP, Prime Minister Najib Mikati came up with a plan to amend the customs dollar, considering that its price cannot remain at 1,500 LBP, but forgetting the dire repercussions of this decision on the economy in general and citizens in particular.

In fact, this adjustment in the customs dollar is demanded by the International Monetary Fund as part of the reforms required and to secure and enhance revenues for the public treasury, especially after the losses it incurred recently. But is this the right time to implement this decision?

Of course, this new request will impact the trading activity severely, and the merchant’s sales will shrink, but the real danger will be reflected on smuggling business that will certainly grow. Smuggling will inevitably return when prices rise, and thus the legitimate merchant will not be able to compete with smugglers because his cost will increase.

Therefore, implementing this decision without conducting further studies or providing parallel solutions will only be a new curse on the Lebanese.

  • Sawt Beirut International