The transfer of funds in foreign currencies to Lebanon occurred under the horror of the economic crisis and banking restrictions, and the role of transfer companies, which became de facto, has become an alternative, even temporarily, to the banking sector. However, the deteriorating situation became more and more confused, with the frequency of circulars issued by the Banque du Liban in this file.
On December 30, 2019, the Banque du Liban issued a circular requiring money transfer companies to return to pay remittances received from abroad in cash in US dollars, and on April 16 this year, in circulating the number 13220, returned to the request from non-banking institutions that conduct cash transfers by electronic means By paying the value of any electronic cash transfer in foreign currencies received from abroad, in Lebanese pounds according to the market price, provided that the Bank of Lebanon acquires, according to the circular, the dollars that the transfer institutions will provide after the process of replacing the dollar with the lira.
On Friday, the Directorate of Cash Operations in the Bank of Lebanon set the exchange rate for cash transfers received from abroad at 3,625 pounds.
The economist, Jassem Auja, expresses his fear for the general situation in the country, and this decision links Lebanon’s need to dollars, because the price of the dollar in circulation is two times greater than the official exchange rate.
He sees in an interview with the “Lebanese Forces” website, that the dollars that are transferred to Lebanon, and instead of going to the cashiers, they take possession of and control them, obtained by the Bank of Lebanon for use in the country’s economic machine to meet the needs of the people.
Regretting that the demand for the dollar is massive, he stresses, in turn, that it stems from the political fears hitting the country, and explains that the price of the dollar today is not based on economic foundations.
He adds, “The price of the currency is based on supply and demand. Import has fallen from nearly 20 billion to almost half. What is the justification for the high demand for the dollar, other than the political climate that imposes this mad rise?
Ajaaga recalls that the lira is one of the most important pillars of social security, stressing that the Lebanese economy does not allow today the exchange rate to drop, before Lebanon secures a huge production machine.
And he notes that the circular issued by the Directorate of Monetary Operations in the Bank of Lebanon reflects negative things about the bad role played by the political atmosphere, “What increases the supply of the lira and the demand for the dollar?”
Agaga confirms that the ban on the introduction of dollars into Lebanon made the situation worse, in addition to, of course, the Bank of Lebanon’s lending to the state. Determining the points of use of Lebanon for dollars (importing basic foodstuffs, defending the lira, and depositing the money of depositors), it regrets that its price has been based on confusion and political confrontation between the parties, after the “linking conflict” between them has fallen, and the movement of the streets suggests that the game’s ceiling has collapsed, What will inevitably be reflected on the dollar, and therefore there are no limits to the dollar exchange rate today.