Lebanese economy in tatters, along with its capital
The deadly Beirut explosion has plunged the country deeper into economic crisis with a collapsing currency and spiraling inflation
Dubai — A few days before last week’s deadly explosion in Lebanon, Sarah al Sayed sold a $5,000 cheque at her Beirut money-changer for half its face value — just to get hold of physical dollar bills.
If she tried today, she says she would get even less, with some dealers insisting on a discount of as much as 65%.
“When the crisis erupted last year, the discount was approximately 25%, now it has nearly tripled,” said al Sayed, who owns a furniture-making business in the city’s Corniche el Mazraa district.
The August 4 explosion in Beirut that destroyed Lebanon’s main port and plunged the nation deeper into economic crisis has added urgency to citizens’ attempts to protect their savings against the backdrop of a collapsing currency and spiraling inflation.
Some put their money into physical assets, buying used cars from those with delinquent vehicle debts, or snapping up real estate. The collapse in the Lebanese pound meant one Beirut businessman saw the price of the Dubai apartment he was buying climb 25% during the course of the deal.
The disaster also damaged the assets of Solidere, a real-estate company shares of which have long been a haven investment because they’re denominated in dollars. When the Beirut bourse reopened on Monday, Solidere’s stock slumped initially, before recovering to close slightly higher.
Nour, a freelance consultant who declined to give her second name, thought herself lucky until the explosion. While she can’t access her savings account, she’s eligible for a dollar account that has allowed her to withdraw her salary in $300 portions each week and exchange them for Lebanese pounds.
Since the blast left her apartment half-destroyed, she is putting almost all her money into fixing the damage.
For al Sayed there isn’t time to think of safeguarding her savings. She’s busy going house-to-house with her team of workers, offering repairs for free.
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