Lebanese food importers are requesting that the Central Bank of Lebanon pays matured subsidy bills worth around $75 million.
The call came in a statement issued on Wednesday by the Syndicate of Food Importers, in which the Syndicate described Lebanon’s food subsidy mechanism, known as the food basket, as being “clinically dead.”
The Syndicate argued that the mechanism exists on paper today, as the decision to subsidize food products has not officially been canceled.
However, “in practice and on the ground, the subsidy has stopped as a result of the failure of the Banque du Liban to open the necessary funds for it.”
In light of that, the Syndicate urged concerned officials to deal “objectively and knowledgeably” with this matter.
Food importers stressed that they had been performing their national duties that the state tasked them with, in terms of securing subsidized food products, “until the Banque du Liban stopped opening credits.”
According to the statement, continuing to distribute goods at subsidized prices without actually receiving subsidy money from the Central Bank has put importers in front of two options.
The options are: “Either to take a risk and submit the application to the Banque du Liban or to withdraw the file from the Banque du Liban and sell the goods at the market price, which is what’s happening in most cases nowadays.”
Additionally, failing to pay importers back what they have paid to secure subsidized food would subject them to “huge losses that they cannot bear,” the importers’ statement added.
It would also “threaten the loss of thousands of Lebanese jobs and businesses, as well as threaten the continuity of the food influx from abroad and, thus, the food security of the Lebanese,” the statement said.
Subsidies in Lebanon have been on the verge of dissolving as a result of the financial crisis and the drained foreign currency reserves at the Central Bank.
The anticipated decision to lift subsidies is one of the biggest points of discussion in Lebanon today. Here’s what such a move would mean for the country.