Lebanon prepares for end of central bank chief Riad Salameh's term

Meeting reportedly to name successor held between Prime Minister Najib Mikati and four deputy governors

Lebanon's central bank building in Beirut. Reuters
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Lebanon's caretaker Prime Minister Najib Mikati met with the four deputy governors of the country’s bankrupt central bank on Monday in preparation for the end of Riad Salameh’s controversial term.

The meeting, which also included Deputy Prime Minister Saadeh Chami and Finance Minister Youssef Khalil, aimed to have a succession plan in place before the end of the central bank governor's term.

To date, a successor to Mr Salameh has not been named.

The four deputy governors – Wassim Mansouri, Bachir Yakzan, Salim Chahine and Alexandre Moradian – have previously threatened to resign if a successor is not chosen.

Legally, if a successor is not named in Mr Salameh’s absence, the first deputy governor would take his place. But first vice-governor Mr Mansouri told Reuters earlier this month that the role was similar to inheriting a “ball of fire”.

Mr Salameh, 72, has been in the position for 30 years and is the world's longest-serving central bank governor. He will end his term on July 31.

He is largely blamed for the financial crisis that ultimately led to the collapse of Lebanon’s economy. He will leave behind an impoverished country desperately in need of reforms and struggling with a major leadership vacuum.

Before the collapse, Mr Salameh was hailed as a financial virtuoso for attractinging regional and international investment to Lebanon and keeping the pound stable.

He now faces multiple international and domestic charges which include money laundering, embezzlement, fraud and illicit enrichment. There are arrest warrants for him in France and Germany.

He denies any wrongdoing and maintains that he is being made a scapegoat for the country’s economic meltdown.

The role of central bank governor is challenging. Mr Salameh’s successor will inherit Lebanon’s dying economy.

The economic collapse has left around 80 per cent of households without enough food or the money to buy it, according to a UN report in 2021. In Syrian refugee households, the figure reaches 99 per cent.

The Lebanese pound has plummeted, now worth only a fraction of what it once was. Inflation is in triple digits and depositors remain locked out of the majority of their savings.

Numerous economic reforms must be implemented before Lebanon can benefit from an international bailout. But with no president, a caretaker government and soon no central bank governor, change appears increasingly distant.

Updated: July 24, 2023, 4:42 PM