A client inside a supermarket in Lebanon. (Credit: Philippe Hage Boutros/L'Orient-Le Jour)
BEIRUT — The decision to dollarize prices at supermarkets has been postponed, according to caretaker Minister of Economy Amine Salam and a delegation of the General Confederation of Lebanese Workers (CGTL).
Amin met Monday with the CGTL delegation, chaired by Bechara Asmar, to discuss his recent proposal to switch to pricing goods in dollars in supermarkets. Asmar had previously positioned himself against the switch in a statement made Sunday evening when he judged the decision as "hasty" and "ill-considered."
According to both parties at a press conference after the meeting, the decision was postponed, pending the resolution of problems related to its implementation.
Beyond the considerations of "consumer protection," Asmar stressed the issue of payment of a value-added tax (VAT).
"The trader will charge VAT to the consumer at the parallel market rate (around LL63,000 as of Monday evening, editor's note) but will declare this tax to the Ministry of Finance at its official rate of LL15,000," he said.
He also expressed concern that the "dollarization of commodities" might lead to the dollarization of "all other commodities," such as fuel, "while public sector salaries are still calculated at a rate of LL1,507.5."
The former official parity between the pound and the dollar was modified by Banque du Liban (BDL) to LL15,000 last Wednesday.
Technically, Lebanon tripled the initial salaries of civil servants — which were still calculated at LL1,507.5 rate — in the 2022 budget passed last September. Although they can withdraw these funds in dollars at the rate set by BDL's Sayrafa platform (LL42,000, as of Monday evening), this rate is still below the parallel market rate. Therefore, the amount withdrawn is not sufficient to battle increased costs of living and hyperinflation caused by the depreciation of the national currency.
Additionally, Asmar postponed the general strike scheduled for Wednesday to protest against the continued deterioration of the quality of life of workers.
The strike was postponed for a week "due to the bad weather and the sensitivity of citizens to the earthquake that hit Lebanon" early Monday morning. The winter storm that is currently hitting Lebanon continues to cause damage and slow down traffic throughout the country, causing flooding on the roads.
The country's residents were awakened before dawn on Monday morning by the tremors of a massive earthquake that hit southern Turkey, killing thousands in Turkey and Syria.