New low for Lebanese pound triggers fresh protests

Fresh protests broke out in Lebanon as the currency sank to a record low on the black market on Thursday evening.

Protesters blocked roads, torched banks and tried to attack the central bank’s offices as security forces fired tear gas to disperse them. "Thief, thief, Riad Salame is a thief!" demonstrators chanted in Beirut, referring to the governor of the central bank.

For the first time in months, large groups of Hezbollah supporters participated in the Beirut protests which they had largely deserted after the leader of the Shiite Muslim party, Hassan Nasrallah, criticised the anti-government movement shortly after it began last October. Videos shared on social media show them arriving in large motorcades from Beirut’s southern suburbs of Dahiya, a Hezbollah stronghold, as people chant slogans of unity between Islam and Christianity.

Protesters hurled insults at Lebanon’s sectarian power-sharing system, which is widely viewed as encouraging nepotism and corruption.

Lebanon is in the grip of its worst economic crisis in decades and holding talks with the International Monetary Fund to secure billions in aid. The prolonged economic downturn was the major grievance that sparked unprecedented mass protests last year against the political class, accused of corruption and incompetence.

The local currency, still officially pegged at 1507.5 Lebanese pounds to the dollar, has been in freefall for months. On Thursday, rumours spread that it had crashed to 7,000 pounds to the dollar on the black market. Quoting this figure, protesters in Beirut said that this was the main reason why they took to the streets.

However, money changers who spoke to Agence France Presse mentioned lower figures. One money changer who asked to remain anonymous said he was selling dollars at a rate of 5,000 pounds and buying them at 4,800. Another in Beirut's Dahiya neighbourhood was buying dollars for 4,850 pounds.

Protesters said they were also fed up with rapid inflation, which increased by about 70 per cent in one year. Nearly half the Lebanese population lives under the poverty line.

"People can't take it anymore, that's enough," said Haitham, a protester in central Beirut.

"People have no work, no food to eat. They cannot buy medicines, nappies or milk for their children," he told Agence France-Presse.

Nabil, a retired 64-year-old, said his buying power had taken a blow.

"Yesterday I went to a home appliance store to buy a fridge, and the salesman asked me for $1,200 in cash, or the equivalent at an exchange rate of 5,000, which is six million pounds," he told AFP.

"That's twice my monthly pension."

Local television reported security forces firing tear gas to disperse protesters who threw stones near Riad Al Solh square in central Beirut.

In the northern city of Tripoli, the army fired tear gas at demonstrators who tried to take over the local branch of the Central Bank, according to the state news agency NNI, which reported eight people were wounded.

Prime Minister Hassan Diab called an urgent cabinet meeting on Friday to discuss the situation. On Friday morning, the army had reopened most of the roads cut by protesters on major highways across the country with burning tyres.

The currency has continued to fall despite government pledges to halt its devaluation, and the money changers' union issuing a maximum daily buying rate of 3,890 and selling rate of 3,940.

On Thursday evening, a central bank statement cited by local media hit out at "baseless" information on social media of "exchange rates at levels far from reality, which mislead citizens".

Lebanon defaulted on its debt in March for the first time in its history.

Calls for national unity on Thursday evening sharply contrasted with the sectarian clashes that shook Beirut during protests last weekend. For the first time, some protesters explicitly asked for the disarmament of Hezbollah, an Iran-backed militarised party which wields significant regional clout and is labelled a terrorist organisation by several Western states.

Gunshots were fired last Saturday in sensitive Christian, Sunni and Shiite Muslim neighbourhoods. Shiite groups reportedly hurled religious insults at the Sunni community.

Sami Nader, director of the Levant Institute for Strategic Affairs in Lebanon, said that Hezbollah allowed its supporters to participate in demonstrations on Thursday because it wanted the resignation of the central bank governor, who has enforced US sanctions targeting the group's finances. "Toppling Riad Salameh is a strategic objective for Hezbollah since day one," he told The National.

Mr Nader also argued that Hezbollah could be withdrawing its support from the government formed in January. Although Mr Diab’s government is labelled as independent, it is backed mainly by Hezbollah and its allies and has perpetuated practices decried by protesters such as high-level government appointments on sectarian and political criteria rather than merit.

“Hezbollah needs a more representative government that you cannot label as a Hezbollah government to counter consequences of mounting US pressure,” Mr Nader said.