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Lebanese banks close amid wave of demonstrations

Several citizens have stormed branches demanding to withdraw their savings amid the country's dire economic situation
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REUTERS/MOHAMED AZAKIR  -   Central Bank of Lebanon building in Beirut

The economic crisis is increasingly suffocating Lebanon. So much so that citizens have been demonstrating around bank branches, even breaking into them, to demand the recovery of their savings at a time when banks are short of liquidity.

Several of the demonstrators who have staged such 'hold-ups' have been arrested by the security forces, which has provoked the indignation of citizens who, fed up with the economic situation, are demanding their immediate release in the vicinity of Beirut's Palace of Justice. 

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AP/HUSSEIN MALLA - People queue outside an exchange office to buy US dollars, in Beirut, Lebanon

At least five banks have been raided in the last few hours in the midst of a "corralito" that the Lebanese country has been experiencing since 2019, when it was decreed that customers could only withdraw a limited amount of their savings.

For his part, Interior Minister Bassam Mawlaw has branded the branch raids as "organised" acts. The Association of Banks has also demanded that "the necessary measures" be "taken" to ensure that citizens and workers are provided with the necessary security and that the "rights of depositors" are "preserved". 

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AFP/ PATRICK BAZ -  A demonstrator with a Lebanese national flag during clashes with the army and security forces

Thus, the Lebanese Banks Association reported that, finally, "following repeated attacks on banks and physical attacks on bank employees (...) and taking into consideration the risks, the board of directors has decided to close the banks between 19 and 21 September".

They went on to point out that "the safety of employees and customers is the first priority of the banks, as well as the interests of depositors, which they are trying to ensure as far as possible amidst the difficult circumstances in the country". 

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REUTERS/MOHAMED AZAKIRAR  - Women walk under electricity cables in Shatil Palestinian refugee camp

It is also expected that by the time branches reopen, banks will have adopted new self-protection measures, ranging from subjecting customers to inspections to receiving only those who have scheduled appointments in advance.

On the other hand, the Lebanese Depositors Association, Hassan Moghnieh, has warned that "the strike will not solve the current crisis. When work resumes next Thursday, banks could witness a new wave of robberies, which means that the solution lies elsewhere". 

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AP/HASSAN AMMAR  - Beirut in the dark during a blackout, Lebanon, 19 August 2021

In this context, a delegation from the International Monetary Fund (IMF) led by Mission Chief for Lebanon Ernesto Ramirez-Rigo travelled to Beirut and began a series of talks with Finance Minister Youssef Khalil to try to reach a solution to the situation.

According to Ramirez, the main objective is to "learn about the actions taken by Lebanon under the senior staff level agreement reached with the IMF and to urge Lebanese officials to continue implementing the terms of the agreement in order to reach future understandings"

However, these recent developments are not isolated events. In recent years, Lebanon has been going through a series of crises ranging from political to social and economic. Events such as the recent rise in the dollar exchange rate, the absence of a cap to limit this rise and fears of a presidential and governmental absence have become the main concerns of Lebanese society. 

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UNICEF/Fouad Choufany - Public school in Beirut reopened after port explosion in 2020 thanks to UNICEF support

In addition to these reasons, Lebanon has been suffering for years from severe power cuts that block the streets of the capital. In addition to this, and adding up all the different crises the country is going through, the United Nations Children's Forum (UNICEF) has already warned that the situation in the country "has destroyed" the future of thousands of children and young people who see emigration as the only way out.

According to UNICEF's representative in Lebanon, Edouard Beigbeder, "children are growing up without enough to eat, without adequate access to health care and, in some cases, working to support their families" and he urges the government to implement "urgent social protection measures, guarantee access to quality education for all, and strengthen primary health care and child protection services".