Surging inflation takes toll on Lebanon’s blast recovery
SURGING prices are forcing fresh hardship on Lebanon as last month’s explosion combines with a political and economic crisis and the coronavirus pandemic.
Prices more than doubled compared with August 2019 as inflation surged to 120pc, and food and drink prices are
more than four times their level a year ago, up 367pc.
Clothes and shoes are more than five times their old prices, with furniture and home maintenance costs up almost eight-fold. Transport costs have doubled, with telecoms prices not far behind. Prices charged by restaurants and hotels are up more than 500pc. Housing costs are up, but by a far lower amount. Rents are up by just below 9pc on the year, with utilities bills rising by just over one fifth.
Health costs are up by almost 15pc, with education prices rising by below 5pc. The explosion in Beirut’s port devastated large parts of the city, killing hundreds, injuring thousands and causing major problems for trade and the wider economy, but it is not the sole root of Lebanon’s woes.
Monthly inflation in August was 3.6pc – steep by the standards of more stable economies, but Lebanon’s lowest rate since February. Back in April, prices rose by more than one quarter in a single month.
The government defaulted on payments of debts denominated in foreign currencies in March, and remains in trouble on those loans. It means the country has been in lengthy negotiations with creditors, and so is in a difficult position to raise crucial funds for rebuilding the capital city.
Michel Aoun, the president, said the nation was “going to hell” if a new administration was not pieced together, but warned there was “no solution on the horizon to form a new government”.