The Times published a report by Middle East correspondent Richard Spencer titled "Food and Medicine Running Out in Lebanon Amid Economic Collapse." The author states, "There are many reasons behind the collapse of the Lebanese economy, the worst in absolute terms compared to the Wall Street crash, said to be unprecedented in size for a single country in history." He adds, "Two years ago, about 26% of the population lived in poverty, according to World Bank estimates, reinforcing the image of Lebanon as a prosperous state with an unusually dominant middle class in a non-oil-rich Arab world." This month, the United Nations Children's Fund (UNICEF) reported that 77% of households do not have enough money to buy food, according to the author.
In his analysis of the Lebanese situation, the author says the country is "stuck in a geopolitical rift: its Shiite population is aligned with the Iranian and Syrian camp. The Sunnis have historically been supported by Saudi Arabia and, more recently, by Western powers. Its Christians are torn between east and west." He states, "But the immediate cause of the collapse is the collusion of all the main parties in a deal to maintain living standards. The central bank borrowed more money from private banks to pay for imports and subsidize fuel, food staples, and medicines. Then it collapsed last year under this burden."
The author explains that the country now has three effective exchange rates, which, combined with continued subsidies, have created a paradise for smugglers. Fuel is purchased at subsidized prices at the official rate, and sold to Syria where the price is five times higher, with the resulting dollars being converted to Lebanese currency at an unofficial rate that is now 13 times higher than the official rate. Meanwhile, queues at gas stations continue for up to four hours.
In Lebanon, households receive visits from the 'generator man,' the 'internet man,' and now even the 'gas man,' who brings 20-liter canisters to their doors, as long as they have foreign currency to pay for them. The author quotes Adham Al-Maamari, manager of Dar Al-Zahra Hospital in Tripoli, stating that the fact he has to use the black market to buy generator fuel is the least of his worries. "The more alarming issue is that a third of my doctors have left for more lucrative jobs abroad."
"Medicines are also being smuggled abroad and hoarded. In one pharmacy, Fouad Yassin, 50, was pleading to get a Fastarel medication for her elderly mother, which has become a daily task," the author writes.
Saad Hariri has apologized for forming a new government "after 11 months because President Michel Aoun would not accept his proposed government. The stalemate was expected: Hariri, the dominant Sunni politician, hoped to exploit the crisis to challenge the increasing dominance of the powerful alliance between Aoun's Free Patriotic Movement, the largest Christian party, and Hezbollah," the author concludes.
He adds, "Hassan Diab, who has been serving as 'acting' Prime Minister since he officially resigned following the Beirut explosion, says he is not authorized to change the subsidy system or even to order a review of the central bank's accounts. Without these reforms, neither the International Monetary Fund nor foreign governments will save Lebanon."
