Lebanese Dread End to Subsidies

Maya Ibrahimshah, the founder of Lebanese NGO Beit al-Braka (house of blessings) organizes food to be distributed to the needy. AFP
Maya Ibrahimshah, the founder of Lebanese NGO Beit al-Braka (house of blessings) organizes food to be distributed to the needy. AFP
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Lebanese Dread End to Subsidies

Maya Ibrahimshah, the founder of Lebanese NGO Beit al-Braka (house of blessings) organizes food to be distributed to the needy. AFP
Maya Ibrahimshah, the founder of Lebanese NGO Beit al-Braka (house of blessings) organizes food to be distributed to the needy. AFP

To feed her family, Lebanese mother Sandra al-Tawil sold her fridge and washing machine. Now she fears the cash-strapped state will scrap food subsidies, plunging them deeper into poverty.

Lebanon is locked in its worst economic crisis since the 1975-1990 civil war, with no end in sight.

The value of the Lebanese pound has plunged, driving up the price of crucial imports like food and fuel and triggering small but angry protests.

More than half of Lebanon's population is poverty stricken and relies on subsidies, but a central bank demand for "an immediate plan to ration subsidies" is looming.

"We're already tightening our belts. What will we eat if we can no longer buy rice or lentils?" 40-year-old Tawil said.

Tawil and her husband lived a comfortable life in Dubai before returning to their homeland to open a high-end hair salon in 2019.

But that dream turned to nightmare after the financial crisis and the Covid-19 pandemic hit.

"I had to sell my washing machine and fridge... just to get the minimum of daily bread and pay rent," said the mother of two young children.

Her husband found a job at the start of the year, and the Beit El Baraka charity is helping them out with food and school fees.

But Tawil is still worried, and furious with the political class she blames for the malaise.

"If I see people heading out to protest, I'll be the first to join them," AFP quoted her as saying.

In a country that imports 80 percent of its food, much of the six million population depends on subsidies to get by.

Even without them being lifted, many are already struggling, said Beit El Baraka founder Maya Ibrahimchah.

"There have been many more demands for help over the past four months," she said.

"Those we are helping today are all from the middle class."

The state has poured up to $437 million into subsidies a month, the World Bank estimates, to keep prices in check for bread, medicine, fuel and electricity, as well as around 300 other items since mid-2020.

To counter the pound's drastic devaluation, importers get access to dollars at a preferential rate to ensure they can afford to continue bringing in supplies.

For flour, fuel and medicine, for example, they offer dollars at the official exchange rate of 1,507 pounds to cover most of their cost.

But traders must resort to the black market to cover the difference, where Tuesday the rate hit a record low of 10,000 pounds to the dollar.

As a result, in less than a year the price of a large bag of subsidized bread has risen from 1,500 to 2,500 pounds.

Authorities have remained vague about how the subsidies will be reduced, though meetings are ongoing.

In early December, central bank governor Riad Salameh said it could only fund subsidies for another two months. Later that month, he said two billion dollars were available for them.

At the end of February, the central bank's website showed it had $17.9 billion in foreign currency reserves, yet $17.5 billion of that is the bank's required reserves.

The bank did not respond to AFP's repeated requests for comment.

The UN food agency has warned any subsidy reduction would have "major inflationary repercussions" and "put an unbearable strain on households".

The price of bread could increase by up to three times and fuel by 4.5 times, the World Food Program said, adding it was critical to immediately scale up assistance to the poorest.

Under the government's latest plan, subsidies could be gradually lifted, with financial aid to soften the blow over several years.

The state would first lift subsidies for bread, fuel and around 300 other items, under the plan seen by AFP, before later on reviewing spending in the electricity sector.

To compensate, up to 80 percent of the population would receive handouts -- 50 dollars a month for adults aged over 23 and half for anybody younger.

Those amounts, and the numbers of beneficiaries, would then progressively diminish.

Until then, the authorities have secured $246 million from the World Bank to help 786,000 Lebanese.

But Nasser Jomaa, 52, said he doubted the government would really provide any financial support.

"It's just empty words. We have zero faith in the state," said the driver, who lives with his unemployed 25-year-old son.

As the Lebanese pound has plunged on the black market, he has seen his monthly income drop in value from $1,000 to just $160.

He added that any lifting of subsidies would be "catastrophic".

Already, he said, "we no longer eat meat."



Israeli Gunfire Kills 17 People near Gaza Aid Site

Palestinians carry bags containing food and humanitarian aid packages delivered by the Gaza Humanitarian Foundation, a US-backed organization, in Rafah, southern Gaza Strip, Sunday, June 8, 2025. (AP Photo/Abdel Kareem Hana)
Palestinians carry bags containing food and humanitarian aid packages delivered by the Gaza Humanitarian Foundation, a US-backed organization, in Rafah, southern Gaza Strip, Sunday, June 8, 2025. (AP Photo/Abdel Kareem Hana)
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Israeli Gunfire Kills 17 People near Gaza Aid Site

Palestinians carry bags containing food and humanitarian aid packages delivered by the Gaza Humanitarian Foundation, a US-backed organization, in Rafah, southern Gaza Strip, Sunday, June 8, 2025. (AP Photo/Abdel Kareem Hana)
Palestinians carry bags containing food and humanitarian aid packages delivered by the Gaza Humanitarian Foundation, a US-backed organization, in Rafah, southern Gaza Strip, Sunday, June 8, 2025. (AP Photo/Abdel Kareem Hana)

Israeli gunfire killed at least 17 Palestinians and wounded dozens of others as thousands of displaced people approached an aid distribution site of the US-backed Gaza Humanitarian Foundation (GHF) in central Gaza on Tuesday, local health authorities said.

Medics said the casualties were rushed to two hospitals, the Al-Awda Hospital in Nuseirat camp in central Gaza, and the Al-Quds in Gaza City, in the north, Reuters reported.

The Israeli military said they are looking into the incident. Last week it warned Palestinians not to approach routes leading to GHF sites between 6 p.m. and 6 a.m. local time, describing these roads as closed military zones.

There was no immediate GHF comment on Tuesday's incident.

The GHF began distributing food packages in Gaza at the end of May, overseeing a new model of aid distribution which the United Nations says is neither impartial nor neutral.

However, many Gazans say they have to walk for hours to reach the sites, meaning they have to start travelling well before dawn if they are to stand any chance of receiving food.

While the GHF has said there have been no incidents at its so-called secure distribution sites, Palestinians seeking aid have described disorder and access routes to the sites have been beset by chaos and deadly violence.

"I went there at 2 a.m. hoping to get some food, on my way there, I saw people returning empty-handed, they said aid packages have run out in five minutes, this is insane and isn't enough," said Mohammad Abu Amr, 40, a father of two.

"Dozens of thousands arrive from the central areas and from the northern areas too, some of them walked for over 20 km (12 miles), only to come back home with disappointment," he told Reuters via a chat app. He said he heard the firing but didn't see what happened.

Israel allowed limited UN-led operations to resume on May 19 after an 11-week blockade in the enclave of 2.3 million people, where experts have warned a famine looms. The UN has described the aid allowed into Gaza as "drop in the ocean."

Witnesses said at least 40 trucks carrying flour for UN warehouses were looted by desperate displaced Palestinians as well as thieves near Nabulsi roundabout along the coastal road in Gaza City.