Lebanon to Soon Beat Zimbabwe in Highest Inflation Rate

A Lebanese woman looks at merchandise priced in US dollars in a major supermarket in Beirut. (AP)
A Lebanese woman looks at merchandise priced in US dollars in a major supermarket in Beirut. (AP)
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Lebanon to Soon Beat Zimbabwe in Highest Inflation Rate

A Lebanese woman looks at merchandise priced in US dollars in a major supermarket in Beirut. (AP)
A Lebanese woman looks at merchandise priced in US dollars in a major supermarket in Beirut. (AP)

A recent move by Lebanon’s Central Bank (BDL) to offer to sell the cash dollar through its platform at the rate of LBP 70,000 has temporarily curbed the rapid collapse of the national currency.

The price margins of cash trading in the parallel markets fell to around LBP 80,000 per dollar, after touching the barrier of LBP 100,000 only minutes before the BDL decision was issued on Wednesday night.

Government services and fees, which are collected based on the BDL Sayrafa platform, increased overnight by about 55 percent, especially public electricity and communications bills.

Many factors converge in Lebanon’s consumption markets, signaling unprecedented rises in inflation levels, which could put the country ahead of Zimbabwe, in terms of high food prices in particular, and the cost of living in general.

Asharq Al-Awsat monitored the activity of banks, which have reprogrammed their information networks to comply with the new decision of the Central Bank and to issue the necessary instructions to branch managers and employees.

However, it was noticed that many of them deliberately set special standards that impose compliance with the requirements of “Know Your Customer” and determine the source of liquidity in Lebanese pounds, to avoid exportation through currency exchange operations with money changers.

Experts and analysts agree that the cumulative inflation index, which doubled from about 990 to 2,200 percent last year, will not require more than half of the time period, i.e. the middle of the current year, to achieve a new double jump, unless positive internal developments occur.

Those are particularly related to the election of a president of the republic, the formation of a new government, and the issuance of a package of laws for an agreement with the International Monetary Fund (IMF), which is conducting a new field assessment through a team that will visit Beirut next week.

Market traders and dealers told Asharq Al-Awsat that the 9 percent increase in prices, which was recorded at the end of the first month of 2023, is nothing more than the tip of the inflation iceberg, under which gloomy indicators lurk. Some of the data are likely to appear at the end of the first quarter, they remarked.

The continuous collapse of the Lebanese pound is inevitably reflected in prices, primarily those of food commodities and fuels, followed by basic expenditures, such as the supply of electricity from private generators, transportation, water and other daily life necessities.

At the same time, the Ministry of Finance began collecting customs duties according to the updated pricing, which is based on calculating the dollar at a price of LBP 45,000, which is equivalent to three times the price adjusted a few months ago, i.e. LBP 15,000 per dollar.

Preliminary estimates point to automatic increases, ranging between 5 and 15 percent, on the prices of goods subject to customs duties, with the exception of food commodities, medicine, medical supplies, and other basic materials.

Estimates also suggest that the government, under pressure to meet wage increases, allowances, and aid for about 330,000 public sector employees, will resort to additional adjustments in calculating the costs of public services and fees, to become closer to the price of the black market.

In fact, private educational and hospital institutions and telecommunications companies resorted to pricing the services in “fresh” dollars, partially or completely. This was seen in the unprecedented rise in telecommunications prices by 331 percent during the second half of 2022.

Similarly, the cost of health services (medicine, hospitalization and medicines) increased by 176 percent. Education costs have also augmented by more than 191 percent, bearing in mind that social and health benefits have shrunk to minimum levels, as health coverage available from public funds now ranges between 5 and 20 percent of the real cost incurred by employees in the public and private sectors.



US Imposes Fresh Sanctions Targeting Iran Oil Trade, Hezbollah

Supporters of Hezbollah carry flags of Hezbollah as they shout slogans during a celebration organized by Hezbollah in front of the Iranian Embassy in Beirut, Lebanon, 25 June 2025. (EPA)
Supporters of Hezbollah carry flags of Hezbollah as they shout slogans during a celebration organized by Hezbollah in front of the Iranian Embassy in Beirut, Lebanon, 25 June 2025. (EPA)
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US Imposes Fresh Sanctions Targeting Iran Oil Trade, Hezbollah

Supporters of Hezbollah carry flags of Hezbollah as they shout slogans during a celebration organized by Hezbollah in front of the Iranian Embassy in Beirut, Lebanon, 25 June 2025. (EPA)
Supporters of Hezbollah carry flags of Hezbollah as they shout slogans during a celebration organized by Hezbollah in front of the Iranian Embassy in Beirut, Lebanon, 25 June 2025. (EPA)

The US imposed sanctions on Thursday against a network that smuggles Iranian oil disguised as Iraqi oil and on a Hezbollah-controlled financial institution, the Treasury Department said.

A network of companies run by Iraqi-British national Salim Ahmed Said has been buying and shipping billions of dollars worth of Iranian oil disguised as, or blended with, Iraqi oil since at least 2020, the department said.

"Treasury will continue to target Tehran’s revenue sources and intensify economic pressure to disrupt the regime’s access to the financial resources that fuel its destabilizing activities," Treasury Secretary Scott Bessent said.

The US has imposed waves of sanctions on Iran's oil exports over its nuclear program and funding of militant groups across the Middle East.

Reuters reported late last year that a fuel-oil smuggling network that generates at least $1 billion a year for Iran and its proxies has flourished in Iraq since 2022.

Thursday's sanctions came after the US carried out strikes on June 22 on three Iranian nuclear sites including its most deeply buried enrichment plant, Fordow. The Pentagon said on Wednesday the strikes had degraded Iran's nuclear program by up to two years, despite a far more cautious initial assessment that had leaked to the public.

The US and Iran were expected to hold talks about its nuclear program next week in Oslo, Axios reported.

Said’s companies and vessels blend Iranian oil with Iraqi oil, which is then sold to Western buyers via Iraq or the United Arab Emirates as purely Iraqi oil using forged documentation to avoid sanctions, Treasury said.

Said controls UAE-based company VS Tankers though he avoids formal association with it, Treasury said. Formerly known as Al-Iraqia Shipping Services & Oil Trading (AISSOT), VS Tankers has smuggled oil for the benefit of the Iranian government and the Islamic Revolutionary Guard Corps, which is designated by Washington as a terrorist organization, it said.

The sanctions block US assets of those designated and prevent Americans from doing business with them.

VS Tankers denied Treasury's assertions and said it will "pursue all legal remedies as necessary." Iran's mission in New York did not immediately respond to a request for comment.

The US also sanctioned several vessels that are accused of engaging in the covert delivery of Iranian oil, intensifying pressure on Iran’s "shadow fleet," it said.

The Treasury Department also issued sanctions against several senior officials and one entity associated with the Hezbollah-controlled financial institution Al-Qard Al-Hassan.

The officials, the department said, conducted millions of dollars in transactions that ultimately benefited, but obscured, Hezbollah.