Fresh bread in a Beirut bakery on July 1, 2020. (Credit: AFP)
BEIRUT — Economy Minister Amin Salam said in a statement Wednesday that “[bread] subsidies will continue and I won’t accept that they be lifted arbitrarily,” amid warnings of a crisis from the Federation of Bakeries’ Syndicates sparked by delays in credit line extensions from Banque du Liban.
Here’s what we know:
• Salam’s statement comes after experts drew parallels between bread subsidies and fuel subsidies which were gradually lifted throughout the summer of 2021.
• The economy minister announced that lines of credit worth $21 million had been opened for wheat imports but were pending cabinet approval, adding that he urged Finance Minister Youssef Khalil to unblock the financing during Friday’s cabinet session.
• BDL subsidized wheat imports at the 1,507.5 Lira to USD official exchange rate while the ongoing economic crisis has depreciated the currency’s value to around LL31,000 per USD on the parallel market at the time of the statement. Salam said that the depreciation of the lira in the past three days complicated fixing bread prices by the economy ministry.
• Federation of Bakeries’ Syndicates head Ali Ibrahim said Monday that bakeries only had “three days’ worth of flour” while telling L’Orient Today that mills’ wheat stocks could meet Lebanon’s demand for “15 to 20 days,” but that grinding the grains was pending authorities’ approval of credits.
• The Russian invasion of Ukraine jeopardized Lebanon’s wheat supply, with nearly 67 to 95.1 percent of which was sourced from Black Sea countries between 2010 and 2018, according to a 2019 study by British international development company Crown Agents. The crisis also caused an international increase in grain prices, incentivizing the approval of a 150 million dollar World Bank loan for wheat import, which still needs the new parliament’s approval.