Workers hopeless as Lebanese pound plummets to 50,000 to the dollar

Currency has lost 97% of its value since the start of the 2019 economic crisis

A technician's salary of 10 million pounds per month is worth $200 at the new rate. AP
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Lebanon's pound plummeted to an all-time low on Thursday, trading at 50,000 against the dollar.

Once pegged at 1,500 against the US currency, it has now lost 97 per cent of its value after economic collapse in 2019 caused by decades of corruption and financial mismanagement.

Hussein, 50, a father of five who works as a technician, said the collapse was “affecting us on every level” including education, health and grocery bills.

He earns around 10 million pounds per month, the equivalent of $200 at the new rate. With the pound crashing on the parallel market, his salary was slashed by almost seven times.

The depreciation of the currency is fuelling one of the highest inflation rates in the world, surging to 189 per cent in the first 11 months of 2022 from the same period a year earlier.

“Before the crisis, two million Lebanese pounds was more than enough to meet the needs of a family,” Hussein said.

"It is impossible now. I do not see the situation improving any time soon.”

Mariam, 34, a pharmacist who earns her salary in cash, had to drastically adjust her way of living since the crisis. “I cannot afford to pay for anything more than essential products,” she said.

She has little hope of the situation improving. “There is no coming back to normal if no political reforms are undertaken,” she said.

Deadlock

Beirut signed a staff-level agreement with the International Monetary Fund in April in a bid to unlock billions of dollars in loans to lift the cash-strapped country out of its financial woes.

But the entrenched elite, which the World Bank says deliberately orchestrated the depression, has made little progress in introducing sweeping reforms the IMF requested to address the crisis.

The country is also dealing with an unprecedented leadership crisis. It has been without a president since October and has a caretaker cabinet with limited powers.

The political deadlock has prevented Prime Minister-designate Najib Mikati from forming a government since a general election in May.

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Updated: January 19, 2023, 5:36 PM