By Ebi Kesiena
Lebanon’s Interim Central Bank Governor, Wassim Mansouri has stated that the bank will not print money to lend the state or cover the crisis-hit economy’s projected deficit.
Mansouri while addressing a press conference on Friday, noted that there was an urgent need for leaders to embark to financial reforms to save the economy.
According to Mansouri, the central bank won’t offer loans to the state and does not plan on printing money to cover the huge budget deficit to avoid worsening inflation.
“The central bank will not cover the deficit by lending to the government, neither in dollars nor in Lebanese pounds.
“Lebanese currency will not be printed to cover the deficit,’’ he said.
Mansouri added that the government would have to pay public sector salaries for the month of August in US dollars, calculated using an exchange rate of 85,500 pounds per US dollar to pump cash into the market through public sector employees.
Also, Mansouri maintained that with further delayed reforms the country stands at risk of isolation from international global financial systems.
Mansouri took the helm at the central bank on August 1, after the previous governor, Riad Salameh, ended his 30-year tenure with his legacy in tatters over corruption allegations, which he denies, and with the financial sector in turmoil.
Since Lebanon’s economy began to unravel in 2019, the pound has severely devalued, depositors have been locked out of their bank savings and families have been pushed into poverty.
But the country has failed to enact reforms demanded by the International Monetary Fund to gain access to $3 billion in aid.
