His Excellency Al-Shami, Deputy Prime Minister of Lebanon, declared that the State and the Central Bank of Lebanon were bankrupt;

Indicating that these losses will be distributed to the state, the Banque du Liban, banks and depositors.

Al-Shami said - in a television program broadcast by the local Al-Jadeed channel on Sunday - that "there is no conflict of views about the distribution of losses, and they will be distributed to the state, the Banque du Liban, banks and depositors."

He stressed that the state went bankrupt, as well as the Bank of Lebanon, and the loss occurred, and we will seek to reduce the losses for the people.

No other official comment was issued on Al-Shami's statements, which indicate a deeper financial and economic crisis in Lebanon, and may lead to sharp disputes between depositors and banks.

And the government official added, "There is a fact that cannot be ignored. We cannot open (bank) withdrawals to all people. I wish that we were in a normal situation."

For nearly two years, Lebanon's banks have imposed restrictions on depositors' money in foreign currency, especially the US dollar, and placed severe ceilings on withdrawing money in Lebanese pounds (according to the value of the deposit and the bank), following a severe economic and financial crisis.

In May 2021, the Central Bank of Lebanon launched a “exchange” platform to complete the sale and purchase of foreign currencies, specifically the dollar, at a moving price determined by supply and demand, provided that it intervene when necessary to control fluctuations in the prices of the banking market.

The value of the lira against the dollar has been stable for more than a quarter of a century at 15.15, but it has gradually deteriorated since late 2019, affected by a severe economic crisis afflicting the country, to an average of 23,000 currently.

Among the 3 worst crises in the world

Today, Monday, Director of the Middle East Department at the World Bank, Saroj Kumar Gah, described the crisis that Lebanon is going through as the worst in its history, and that it is among the three worst crises in the world.

Kumar's words came during his participation in the reform, recovery and reconstruction framework meeting for Lebanon's economic recovery, chaired by Prime Minister Najib Mikati, and in joint coordination between the United Nations, the European Union and the World Bank in Beirut.

Kumar called - in a speech cited in a statement by the Lebanese government - to the need to achieve stability at the macroeconomic level.

He said that Lebanon has witnessed many crises, but this crisis is the worst. Indeed, Lebanon's crisis is among the 3 worst crises in the world.

Video - This is what HE Al-Shami said about the bankruptcy of the state and the #Bank_Lebanon https://t.co/KSyorJJXWC pic.twitter.com/3PNQBx2mKe

— Al-Jadeed Channel (@ALJADEEDNEWS) April 4, 2022

For two years, Lebanon has been suffering from the worst economic crisis since the end of the civil war (1975-1990) that led to a financial collapse, as well as great material losses to the banking system, estimated by the government at about $69 billion.

Kumar stated that the economic situation is dire;

"The size of the economic contraction has reached 60% until 2021."

However, he expressed his optimism about the national reform program led by Mikati, and if this program does not reach well, it will constitute a further contraction of the economy, and will lead to a crisis in economic and social conditions.

He believed that there is a need for a reform plan that includes a financial program, debt repayment, restructuring the financial and banking sector, and developing social protection systems.

Mikati said that "the government is working through the relevant authorities in the public sector to unify the single and comprehensive vision for development, recovery and reform among those concerned, and we are close to completing the unification of this vision to implement the necessary reforms."