Lebanese Pound Steadily Drops In Doubtful Anticipation Of Cabinet Formation

Decoventure | Reuters

As Lebanon awaits the formation of a new Cabinet, the Lebanese pound is on a slow and steady drop against the dollar.

The Lebanese pound rose against the dollar last week when Future Movement leader Saad Hariri was nominated PM-designate. It was not a surprise, as fluctuations are common, even expected, with every political event in the country.

Now, as Hariri moves to follow up on his promise to form a government of nonpartisan specialists, the Lebanese pound is curling back against the dollar, falling from its rise trading at a steady 6,850 LBP.

Despite the reassurance of some officials that a reformist government will materialize within a week, doubts loom over the probability of its achievement. Political parties continue to interfere. They’re choosing their own specialists for their ministries.

For instance, the finance ministry will go to Parliament Speaker Nabih Berri, according to a report in Kuwait newspaper Al-Jarida.

That ministry was previously demanded by the Shiite ruling leaders while PM-designate Mustapha Adib attempted (and failed) to form a government of independents.

Motions such as these raise reasonable doubts that the new government will be any different than the one(s) before.

However, another way to think of this is to focus on the surrounding atmosphere in which this government is being formed.

First, the elephant in the room is the immense pressure from the international community. With all eyes on Lebanon since the Oct. 17 Revolution, the international pressure seems to be subduing the parties into possibly getting their act together.

With that being the case, Hariri seems intent to play the “savior” card which, if succeeded, could pull Lebanon out of its crises, and consequently improve his reputation after serving 3 times as premier while the country continued its ‘steady’ pathway towards the collapse.

Back with France by his side, Hariri is most likely planning to make major reforms. Whether he’ll succeed is another question.