According to the Finance Ministry’s latest figures, Lebanon’s public debt hit $102.7 billion at the end of September 2022. The information was relayed by Lebanon This Week, Byblos Bank’s weekly magazine.
If we consider this number in accordance with the average of Banque du Liban’s (BDL) Sayrafa exchange rate — LL29,800 to the dollar, at the end of September — the total debt would be valued at $43.8 billion.
This new level of debt marks a 3.5 percent increase from the $99.2 billion debt reached in September 2021. Lebanon’s debt has thus increased by $3.6 billion since 2021.
At the end of September 2022, 60.5 percent of public debt was denominated in lira and 39.5 percent in foreign currencies. This corresponded to LL93,602 billion — $62.1 billion at the old official rate of LL1,507.5 and only $6.24 billion at the rate of LL15,000 to the dollar — and $40.6 billion respectively. Arrears were not reported.
In 2022, the ministry did not publish figures related to the distribution of total debt. BDL holds 62.3 percent of the public debt denominated in national currency at the end of September 2021, while commercial banks hold 18.2 percent at this same rate. Other financial institutions and the public hold 19.5 percent. The majority of foreign currency debt is held by Eurobond holders ($38.6 billion), while multilateral institutions hold $1.6 billion and foreign governments hold $461 million.
According to previously published data, BDL and commercial banks hold more than half of Lebanon’s total debt, having invested heavily for years in treasury bills and Eurobonds with high rates of return, rendering them particularly vulnerable when the government decided to default on its foreign currency debt payment in March 2020 on the sidelines of the crisis.
With rumors of a possible default, some of the international creditors came together under the banner of the Ad Hoc Lebanon Bondholder Group to negotiate with Lebanon. They tried twice to remind the country of its obligations, but to no avail. Three years have since passed and still no debt restructuring has taken place.
This article was originally published in French on L'Orient Le-Jour.
