The exchange rate of the dollar in the parallel market continues to rise “insane” in exchange for the collapse of the Lebanese pound, to exceed today the 38,000-pound limit, and this continues to reflect on the living conditions of the citizen who alone pays the price of the financial and economic collapse in Lebanon.
As the dollar exchange rate increases on a daily basis and is accelerating, which affects the high prices and the living situation of the citizen, to what extent will the dollar continue to rise and what is the next scenario for the collapse of the Lebanese pound?
In this context, economist Patrick Mardini said in an interview with “Lebanon Debate” that “there is no ceiling for the dollar’s rise and no bottom for the collapse of the lira, as long as we continue the same approach that we were taking before the crisis and three years ago we did not do any reforms, so the dollar will keep rising.”
Mardini said: “The dollar will rise, but this does not mean that it will jump one jump. If we do not carry out reforms and stay on the same approach, the dollar will rise significantly, and from now until a month, the upward trend will continue.”
He explained, “The dollar is rising because there is a deficit in the public budget. Expenditures are greater than revenues, and these increased expenditures are financed by increasing the monetary mass, that is, through the Central Bank, which grants the government funds to be able to continue spending, and these lira provided by the bank to the government turn into a demand for The dollar, and consequently, an increase in the exchange rate.
He added, “As long as there is a banking crisis and people cannot get their dollars from banks, as long as there is a change in withdrawals, and therefore we have an increase in the size of the money supply in pounds, and therefore the dollar will continue to rise.”
Mardini continued, “The public budget will have an increase in the deficit, and this means an increase in the need for financing, and an increase in pumping cash into the markets. Today, it is rumored regarding a correction in salaries and wages, if this happens, it means that public expenditures will increase, and in the absence of funds, the government will finance itself through a price collapse.” exchange the lira.
And he added, “The dollar does not rise, but the lira is collapsing, because there is a deliberate policy that the government continues with high expenditures and increases its expenditures, and because we withdraw the Lebanese dollar, and this leads to a rise.”
Mardini pointed out that “to protect the citizen, the lira must be withdrawn from circulation and replaced with the dollar, to stay on two currencies and the lira is collapsing and the dollar is rising and the pensions are in lira, this means that the citizen pays the price of the crisis from his purchasing power.”
He explained, “What should happen is comprehensive dollarization. Today, all institutions are dollarised, prices are dollarized, and the government is trying to dollarize its income. There is only the squalid citizen whose livelihood is in the Lebanese and by paying everything in dollars, this is unacceptable.”
He stressed that “in fairness to the Lebanese citizen, comprehensive dollarization must be resorted to, which is easy and uncomplicated,” noting that “this is by allowing companies to price in dollars, but pensions must be paid in dollars and taxes as well, and therefore the company that sells its goods in dollars must pay pensions in dollars.”
Mardini concluded by saying: “When the private sector rolls, if the state collects its taxes in dollars, it can pay the employees in dollars, and then the lira is withdrawn from circulation, and the central bank buys the lira that is in the market between deposits and cash lira, which is less than 3 billion, and thus buys it and becomes our currency.” The real official is the dollar.”