An hour prior to the official announcement of the new Lebanese government on Tuesday, January 21st, the Syndicate of Money Changers in Lebanon announced that the fixed exchange rate has now become 2,000 Lebanese pounds per 1 US dollar.
The syndicate’s announcement came after months of instability in the USD to LBP exchange rate in the local market.
This rate increased, at times, to up to 2,500 LBP, which is very high compared to the official rate that has remained locked at the usual 1,507-1,518 LBP throughout the period of the fluctuations.
“As a result of the security, economic, and financial conditions that the country has recently reached, which in turn led to a rise in the dollar exchange rates in the markets, [the prices] exceeded the citizens’ ability to afford them, especially those with limited incomes,” the Syndicate’s statement issued.
It went on announcing that, in agreement with the Governor of the Central Bank, Riad Salameh, the stabilization of the purchase price of the US dollar is now “at a maximum of two thousand Lebanese pounds.”
The syndicate also warned that any money changer who infringes the now-fixed rate, starting tomorrow morning, Wednesday, January 22nd, will face disciplinary action: Violators will incur “administrative and legal penalties by the relevant authorities.”
Despite the syndicate not explicitly mentioning the political aspect of the decision, its new measure was, naturally, a direct effect of the (then-expected) birth of the new government.
Regardless of their plans and actions, or their lack thereof, just the fact that the 3-month-old void in the government is now occupied with ministers again should have a positive effect on the economy of Lebanon.
However, a necessary question remains: If the Syndicate of Money Changers in Lebanon were able to stabilize the exchange rate with the push of a button, what have they been waiting for all this time?
Because the show of control that they just exhibited ought to arouse doubt in people’s minds…
It causes them to inquire, as many Twitter users did: Has the Syndicate of Money Changers been taking advantage of the governmentless-ness of Lebanon and using it as an excuse to manipulate the exchange rate to profit from it?
Of course not…
