بالأرقام… هكذا أثر العدوان على مالية الدولة

Lebanon was barely regaining some stability and financial balance after the economic, financial, and banking crises that struck at the end of 2019, with national income dropping from $54 billion to around $20 billion, when the Israeli aggression came to inflict further heavy losses on lives and properties. This led to widespread destruction of thousands of residential buildings and economic institutions, especially in the south, Bekaa Valley, and the southern suburbs of Beirut.

According to estimates by economists and financial experts, the ongoing war has already cost the Lebanese economy more than $10 billion in direct losses, excluding the costs of shelter and assistance for over 1.4 million displaced persons from the areas under bombardment and destruction.

While the majority of losses and damages have affected citizens and the private sector, thanks to successful international negotiations and pressures that helped shield public facilities and institutions, questions arise about the current state of public finances and the extent to which the aggression has impacted Lebanese treasury revenues and expenditures.

An informed source confirms that treasury revenues, which had previously been growing positively and began to recover in the first eight months of this year, have seen a decline in rates starting in September, continuing at an even faster pace during October.

The treasury managed to achieve a substantial surplus exceeding $650 million “fresh” during the first eight months of the current year, with revenues reaching about $2.7 billion, while expenditures amounted to around $2 billion during that period. This acceptable surplus encouraged the government to approve gradual increases for public sector employees and retirees, totaling four additional monthly salaries (based on 2019 salaries) and grants worth 10 million Lebanese pounds for September and December. It is expected that the treasury will begin paying these increases retroactively starting at the end of this month.

However, this surplus, which the central bank relied on to bolster its foreign currency reserves, necessitated the use of part of it for emergency relief for the displaced and the injured due to the war, while the remaining portion was allocated to cover public treasury expenses and state costs, particularly after the recent increases approved for the public sector and retirees, which amount to a total of $40 million per month. This has raised the monthly payroll costs from about $120 million to approximately $160 million.

Despite the catastrophic consequences of the war on the private sector and production forces, the treasury has not lost its capacity to pay salaries and wages to the public sector and retirees, and it still has the ability to secure state expenses without needing any funding from the Bank of Lebanon in the coming months. However, matters could become more complicated and difficult, with financial solvency decreasing, if public facilities are targeted and their revenues lost or if the war prolongs for several months.

Regarding the exchange rate, sources confirm that the Bank of Lebanon currently has the full capability to ensure monetary stability and control the monetary mass in Lebanese pounds, which stands at about 52 trillion pounds, equivalent to $600 million, while its foreign currency reserves are around $10.5 billion.

It is noted that “hard currency reserves” have continued to grow positively since August 2023, but they have started to decline gradually in recent months following the exceptional payment of two additional installments to depositors benefiting from circulars 166 and 158 during October, as part of the Bank of Lebanon's efforts to utilize available means to assist depositors during these difficult circumstances.

The state may currently manage to secure the minimum required in the short term, but sources hope for support from friendly and brotherly countries to Lebanon, especially at the support conference to be held in Paris today, where it is hoped that Lebanon will receive the necessary assistance across all sectors, including support for the treasury and the Lebanese army.