Quarrel between Beirut and Riyadh: another threat to the Lebanese economy

Audio 03:49

In Lebanon, the population lives at the rate of political crises and violence, but also at the rate of shortages and permanent price increases.

Here, in Beirut, October 26, 2021 © REUTERS - ISSAM ABDALLAH

By: Aabla Jounaïdi Follow

4 min

Washington calls for the maintenance of diplomatic relations between Lebanon and the Arab Gulf countries.

Because the crisis between Lebanon and Saudi Arabia triggered after the words of a Lebanese minister criticizing the war led by Riyadh in Yemen continues.

The Lebanese government formed barely two months ago is in a deadlock.

This diplomatic crisis with the big Arab neighbor raises fears of a worsening of the economic situation.

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It is one more test for the Lebanese population.

This crisis sparked by Riyadh to encourage Lebanese officials to distance themselves from Hezbollah comes at a time when the government recently formed in Beirut must come to terms with its Arab neighbors.

It is even one of the priorities of Prime Minister Najib Mikati's team.

The country needs the return of international aid to revive its economy and in this regard, the Gulf countries and their petrodollars are essential.

This is the message sent by Riyadh by drawing the economic weapon

For lack of political levers that it no longer has in Lebanon, the kingdom is playing the economic card.

He had done it against Qatar in 2017. Except that Lebanon does not have the assets of Qatar and that it risks economic suffocation.

Saudi Arabia has banned Lebanese imports which last year amounted to at least $ 217 million (188 million euros).

This is 6% of the country's total exports, but in these times of crisis, Lebanon cannot do without any source of foreign exchange.

And even less those of transfers from the Lebanese diaspora

These transfers represent a third of Lebanese GDP, a record in the Arab world.

One billion dollars are transferred each year from Saudi Arabia.

The fear that reprisals will spread to this community and this manna begins to be felt.

Afraid of being deported, afraid of not being able to send money to their loved ones, some members of the Lebanese community in the Gulf countries launched a petition this week to disassociate themselves from their own government.

If this manna were to be affected, the consequences would be disastrous for the Lebanese

Money transfers to Lebanon have always supported the economy.

But in the current crisis - one of the worst since 1850 - these transfers are a breath of fresh air.

In Lebanon, the population lives at the rate of political crises and violence, but also at the rate of shortages and permanent price increases.

There were further increases on Wednesday November 3 in fuel and some bread packages.

This diplomatic crisis is wasting precious time as the Lebanese are sinking deeper into poverty every day.

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  • Lebanon

  • Economic crisis

  • Saudi Arabia

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