Salameh Seeks to Ease Demand for Dollars

Central Bank Governor Riad Salameh said on Monday that the bank will secure foreign currency for some imports in a move that is expected to ease the demand for hard currency.

Salameh said after meeting President Michel Aoun at Baabda that the central bank will secure foreign currency needs of the private and public sectors, according to official prices.

Salameh met with Aoun following a day of street protests over Lebanon’s deteriorating economic conditions.

He noted that BDL will issue a circular on Tuesday to regulate ways to fund imports of fuel, medicine and wheat.

The meeting comes a day after hundreds of Lebanese protested in the country's capital and other areas over an economic crisis that worsened over the past two weeks, with worries over dollar-reliant Lebanon's local currency losing value for the first time in more than two decades.

Lebanon is facing a deep-running fiscal crisis as it staggers under one of the highest debt ratios in the world, at $86 billion or more than 150% of the country's gross domestic product.

Many of Sunday's protesters in downtown Beirut blamed Lebanese political leaders for the widespread mismanagement and corruption.

Lebanese officials, including Aoun and Central Bank Salameh, have tried to play down the risk of an economic collapse.

Last week, the local currency reached 1,650 Lebanese pounds to the dollar at exchange shops after it had been stable at 1,500 since 1997. Although the official price is still pegged at 1,500 pounds to the dollar, people find it difficult to get hard currency at this rate from local banks.

Salameh however denied last week that Lebanon was facing a dollar crisis.

Last week, amid fears that there will be an open-ended strike at gas stations, people waited in long lines to get vehicles filled.

Because of the shortage in hard currency, there have been complaints by importers of fuel, medicine and wheat, that they buy the products from abroad paying in U.S. dollars and when they sell in Lebanon they do so in the local currency.

Lebanon's central bank is scheduled to issue instructions to regulate ways to fund imports of fuel, medicine and wheat on Tuesday.