Lebanon agrees to imburse WB fund for families in hard currency

Lebanon’s government and central bank have agreed to imburse international aid and funds to vulnerable Lebanese families and refugees in hard currency following pressure from civil society groups and alternative political parties on the World Bank and international donors.

The World Bank has previously approved a US$246 million new project to provide emergency cash transfers and access to social services to approximately 786,000 poor and vulnerable Lebanese reeling under the pressure of Lebanon’s economic and COVID-19 crises.

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Lebanon’s Central Bank announced earlier that the funds will be distributed at a rate of 6,240 Lebanese liras for each US dollar, while the black-market exchange rate has further depreciated to reach 15,000 Lebanese lira per US dollar.

A letter to the country’s finance ministry seen by the, representatives of the European Union, United Nations and World Bank said they “take note of the verbal agreement” on February 22 by the Central Bank chief and deputy prime minister for aid to be disbursed in US dollars, Thomson Reuters Foundation reported.

Economist Dan Azzi said that the “Wollar” rate, which is the term he created for the exchange rate set by the Central Bank for the World Bank loan, is officially dead.

“So, no theft of 30 percent by the Central Bank. Not only that, the old 3900 Lira rate for NGOs & other aid organizations is also dead, so no more theft of 75 percent of the more than a billion US dollars from international charity to the poor,” he added.

Researcher at Human Rights Watch Aya Majzoub said that the decision is a “big deal and a big victory.”

“International aid to Lebanese and refugees will be given in fresh US dollars rather than Lebanese lira, which had allowed the Lebanon Central Bank and commercial banks to pocket the US dollars and distribute Lebanese liras at a highly depreciated rate,” she said.

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