Bank of Lebanon: Monetary improvement and increase in foreign reserves economy

Acting Governor of the Bank of Lebanon, Wassim Mansouri, announced today, Thursday, an improvement in the country’s monetary conditions following the election of President Joseph Aoun a week ago, including an increase in foreign reserves that reached $300 million.

This came during a press conference held by Mansouri at the Baabda Presidential Palace, east of Beirut, following his first meeting with President Aoun.

Mansouri said that the monetary conditions in Lebanon are witnessing a noticeable improvement, as the central reserve in foreign currencies has increased by $300 million since the election of the President of the Republic last Thursday.

The Lebanese official did not mention the total value of the country’s current foreign reserve, but the last announced figure was last August when it reached 8.96 billion dollars.

Mansouri explained that the Bank of Lebanon’s policy is based on maintaining the stability of the Lebanese pound’s exchange rate, while refraining from direct intervention in the market.

He pointed out in this regard that, as of August 1, the Central Bank adopted a policy of selling the Lebanese pound through the banking sector only.

Mansouri also stressed that achieving monetary stability requires controlling the monetary supply in coordination with the government.

He added, “We have indications of a great external desire to cooperate with Lebanon, which heralds an improvement in the economic situation with the flow of dollars into the country.”

Regarding depositors’ funds, Mansouri said, “I feel embarrassed to talk about this issue as long as I do not have a final answer about the mechanism for recovering funds. However, we conducted a comprehensive study to provide a clearer vision that the government can rely on.”

Since 2019, banks in Lebanon have imposed strict restrictions on depositors’ funds in foreign currencies, while setting strict ceilings for withdrawals in Lebanese pounds.

Economic crisis

This comes in light of an unprecedented economic crisis that led to a widespread financial collapse.

After a vacancy of more than two years due to political disputes, on January 9, the Lebanese Parliament elected Aoun as president of the country.

Before his election as president, Aoun had been army commander since 2017, and became the fifth army commander in the history of Lebanon to reach the presidency, the fourth in a row, and the 14th president of the country overall.

Aoun will face a bumpy road due to political, economic and diplomatic challenges after the severe crises that the country has been exposed to since 2019.

It will urgently need international support to achieve economic reforms that stop the economic, monetary and banking deterioration.