In Lebanon these days, with the pound having lost more than 80 percent of its value, discussion on the daily US dollar rate has become as commonplace as the weather or football.
Over the past months, sharp falls in the pound’s value have prompted outbursts of popular anger, while steady gains have offered short-lived hope that the worst has passed. Essentially, the pound’s exchange rate against the dollar has become a national benchmark for measuring Lebanon’s economic suffering.
Relatively, the pound’s current demise pales in comparison to its collapse in the ’80s. At the start of the decade and despite the country’s Civil War, the pound stood strongly at LL3.1 to the dollar. But by the end of 1986 it had dropped to LL87. A year later it hit LL505, a 480 percent drop.
Former Economy Minister Nasser Saidi pointed to a set of parallels between then and now. “There are elements in common. The low level of economic growth, the large budget deficits, the political uncertainty and infighting, the low level of international reserves which meant the Central Bank could not intervene,” Saidi told The Daily Star.
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