Lebanon Raises Price of Bread amid Crippling Economic Crisis

Freshly baked bread cools at a bakery in Beirut, Lebanon June 30, 2020. (Reuters)
Freshly baked bread cools at a bakery in Beirut, Lebanon June 30, 2020. (Reuters)
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Lebanon Raises Price of Bread amid Crippling Economic Crisis

Freshly baked bread cools at a bakery in Beirut, Lebanon June 30, 2020. (Reuters)
Freshly baked bread cools at a bakery in Beirut, Lebanon June 30, 2020. (Reuters)

Lebanon’s economy ministry on Tuesday raised the price of subsidized bread for the fifth time in a year amid the country’s worsening economic and financial crisis.

The ministry said the reason behind the latest increase is that the central bank has ended sugar subsidies, which adds to the cost of bread production.

Lebanon is grappling with the worst economic and financial crisis in its modern history — one that the World Bank has said is likely to rank as one of the worst the world has seen in the past 150 years.

The World Bank said in a report this month that Lebanon’s gross domestic product is projected to contract 9.5% in 2021, after shrinking by 20.3% in 2020 and 6.7% the year before.

Lebanon’s currency has lost 90% of its value, breaking a record low earlier this month of 15,500 Lebanese pounds to the dollar on the black market. The official exchange rate remains 1,507 pounds to the dollar.

The central bank has been cutting back on subsidies as foreign currency reserves have dropped from $30 billion at the start of the crisis in October 2019, to nearly $15 billion at the present time.

Most Lebanese have seen their purchase power drop and more than half the population now lives below the poverty line. There are severe shortages in gasoline, medicines and other vital products. Electricity cuts last for much of the day.

The government in June last year raised the price of flatbread, a staple in Lebanon, by more than 30% — for the first time in a decade. It has since raised the price three times before Tuesday.

The Ministry of Economy says 910 grams (2 pounds) of bread will be sold for 3,250 pounds. It used to be sold for 2,750 pounds before the latest increase.



Israel Poised to Approve Ceasefire with Hezbollah, Israeli Official Says

 A photo shows destruction at the site of an overnight Israeli airstrike that targeted the southern Lebanese city of Nabatieh on November 26, 2024, amid the ongoing war between Israel and Hezbollah. (AFP)
A photo shows destruction at the site of an overnight Israeli airstrike that targeted the southern Lebanese city of Nabatieh on November 26, 2024, amid the ongoing war between Israel and Hezbollah. (AFP)
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Israel Poised to Approve Ceasefire with Hezbollah, Israeli Official Says

 A photo shows destruction at the site of an overnight Israeli airstrike that targeted the southern Lebanese city of Nabatieh on November 26, 2024, amid the ongoing war between Israel and Hezbollah. (AFP)
A photo shows destruction at the site of an overnight Israeli airstrike that targeted the southern Lebanese city of Nabatieh on November 26, 2024, amid the ongoing war between Israel and Hezbollah. (AFP)

Israel looks set to approve a US plan for a ceasefire with Lebanon's Hezbollah on Tuesday, a senior Israeli official said, clearing the way for an end to the conflict that has killed thousands of people since it was ignited by the Gaza war 14 months ago.

That optimism was shared by Lebanese caretaker Foreign Minister Abdallah Bou Habib who expressed hope at a G7 meeting in Italy that a ceasefire would be reached by Tuesday night.

Israel's security cabinet is expected to convene later on Tuesday to discuss and likely approve the text at a meeting chaired by Prime Minister Benjamin Netanyahu, the official said.

This would pave the way for a ceasefire declaration by US President Joe Biden and French President Emmanuel Macron, four senior Lebanese sources told Reuters on Monday.

In Washington, White House national security spokesperson John Kirby said on Monday, "We're close" but "nothing is done until everything is done". The French presidency said discussions on a ceasefire between Israel and the Iran-backed Hezbollah had made significant progress.

The agreement requires Israeli troops to withdraw from south Lebanon and Lebanon's army to deploy in the region - a Hezbollah stronghold - within 60 days, officials say. Hezbollah would end its armed presence along the border south of the Litani River.

Israel demands effective UN enforcement of an eventual ceasefire with Lebanon and will show "zero tolerance" toward any infraction, Defense Minister Israel Katz said on Tuesday.

The agreement with Lebanon will maintain Israel's freedom of operation there to act in defense to remove threats posed by Hezbollah and enable displaced residents to return safely to their homes in northern Israel, Israeli government spokesperson David Mencer told Reuters.

The proposal has already won approval in Beirut, where Lebanon's deputy parliament speaker Elias Bou Saab told Reuters on Monday there were no serious obstacles left to start implementing it - unless Netanyahu changed his mind.

Signs of a diplomatic breakthrough have been accompanied by a military escalation. Israeli airstrikes on Tuesday demolished more of Beirut's Hezbollah-controlled southern suburbs, while the armed group has kept up rocket fire into Israel.

The widespread destruction left by Israeli airstrikes has brought into focus a huge reconstruction bill awaiting cash-strapped Lebanon, with more than 1 million people displaced and many left homeless heading into winter.

In Israel, a ceasefire will pave the way for 60,000 people to return to homes in the north, which they evacuated as Hezbollah began firing rockets in support of its Palestinian ally Hamas a day after that group's Oct. 7, 2023 assault.

'THE MISSILES ARE CHASING US'

Israel has dealt Hezbollah massive blows since going on the offensive against the group in September, killing its leader Hassan Nasrallah and other top commanders, and pounding areas of Lebanon where the group holds sway.

"Regarding the ceasefire, I think it will be implemented. Both sides are tired - both sides are tired," said Selim Ayoub, a 37-year-old mechanic from Beirut's southern suburbs.

Hezbollah launched some 250 rockets on Sunday in one of its heaviest barrages yet. The northern Israeli city of Nahariya came under more rocket fire overnight.

"As we were about to sleep, we suddenly heard a huge explosion, the window in our fortified room was shaking," said Ofir Ben David, who was evacuated earlier in the conflict from the Israeli community of Shomera on the Lebanese border.

"The missiles are chasing us all the time."

Diplomacy to end the fighting has focused on restoring a ceasefire based on UN Security Council Resolution 1701, which ended the last major war between Hezbollah and Israel in 2006.

Israel's ambassador to the United Nations, Danny Danon, said on Monday that Israel would maintain an ability to strike southern Lebanon under any agreement.

Lebanon has previously objected to Israel being granted such a right, and Lebanese officials have said such language is not included in the draft proposal.

Two Israeli officials told Reuters that Israel has a side agreement with the US allowing it to take action in Lebanon against "imminent threats."

Senior Hezbollah official Mohammad Raad, writing in a Lebanese newspaper on Tuesday, said it was unlikely Israel would "accept any talk about halting its aggression against Lebanon without pressure or without exhausting the option of using force on the ground".

"However, we will wait and see the results of the indirect negotiations," he wrote.

Hezbollah, seen as a terrorist group by Washington, has endorsed its ally Parliament Speaker Nabih Berri to negotiate.

DEATH TOLL

Over the past year, more than 3,750 people have been killed in Lebanon and over one million have been forced from their homes, according to Lebanon's health ministry, which does not distinguish between civilians and combatants in its figures.

Hezbollah strikes have killed 45 civilians in northern Israel and the Israeli-occupied Golan Heights. At least 73 Israeli soldiers have been killed in northern Israel, the Golan Heights and in combat in southern Lebanon, according to Israeli authorities.

Biden's administration, which leaves office in January, has emphasized diplomacy to end the Lebanon conflict, even as all negotiations to halt the parallel war in Gaza are frozen.