NNA - Prime Minister, Dr. Hassan Diab, chaired in the afternoon, at the Grand Serail, a meeting dedicated to supporting the food basket. The meeting was attended by Ministers of Economy and Trade Raoul Nehme, Indusrty ImadHoballah, Agriculture and Culture Abbas Mortada, in addition to Central Bank Governor Riad Salameh, in the presence of PM Advisors,Khodor Taleb and Georges Chalhoub.
After the meeting, Ministers of Economy, Agriculture and Industry as well as Central Bank’s governor held a joint press conferencedetailing the agreement concluded to support the food basket through the banks, starting next Thursday.
Salameh said: "The Central Bank’s central council has convened yesterday (Monday) and has taken a preliminary decision that will be translated into a final decision tomorrow to pump dollars through banks in exchange for cash payment in Lebanese pounds by merchants, industrialists and all those who deal with agricultural materials, for the goal is to separate the exchange rate fluctuations from rates’ inflation and to preserve the purchasing power of the Lebanese. This measure is important because it will also lead to a decrease in the dollar/Lebanese pound exchange rate, since the import will be mostly transferred to the banking sector and will withdraw Lebanese pounds from the market in exchange for importfinancing. The Central bank and the central council have also worked on a preliminary idea to unify all prices that are outside the scope of the banking sector, that is to say the official price of 3900 LBP; this will apply to money changers and to foodstuffs import. The price of 1500 LBP remains in effect for fuel, wheat, medicine and medical supplies; this price helps preserve the purchasing power because it is also used to pay back housing loans, consumer loans or educational and hospitalization expenses. The central council will convene tomorrow to takefinal decisions as per the list submitted by relevant ministers."
Answering a question about a dispute between the government and the Central bank, the IMF’s reprimandation of Salameh regarding losses-related approach and its support to the Cabinet’s approach, and talks regarding the suspension of negotiations, Salameh replied: “These information are not accurate and this did not happen; this is media talk; the Central Bank is keen on preserving Lebanon’s interest and on fully coordinating with the Lebanese government and Parliament."
Salameh was also asked about BdL circulars aimed at covering Lebanese dollars deposits in Lebanese pounds and the extent to which they impact inflation in the market; he replied: "The citizen has the right to access his funds within certain limits. Most citizens have welcomed this measure."
Asked about the reasons behind the dollarexchange rate’s surge, Salameh said: "The Central Bank has no relationship with the black market. The propaganda related to the dollar exchange rate reaching 10,000 LBP has serves other purposes, including commercial and political ones, and we know that the price is much lower. There are two markets we work on: the money market’s rate of 3900 LBP, and the official market’s rate of 1500 LBP; we are securing dollars at these rates."
Answering a question about the amount of dollars that would be pumped in through banksfor merchants, Salameh stated: "This has to do with the Minister of Economy. However, the support will be provided through the Central Bank’s assets, that is, from the Central Bank’sreserves. We have free funds amounting to 20 billion and 300 million dollars."
Afterwards, the Minister of Economy said: "We held a meeting with Prime Minister Diab, relevant ministers and Central Bank’s governor, with discussions featuring the latest decisions regarding subsidizing basic commodities. The goal is to cover 80% of citizens' purchases from commercial institutions. But we will not only support imports; we will also subsidize basic commodities manufactured or cultivated in Lebanon; we will give priority to industry and agriculture. This goal, as the governor said, will allow citizens to purchase most of their needed products either at the price of 1500 LBP or at over 3900 LBP; this will assist citizens and consumers. We have defined a basket comprised of 300 types of basic products, as per the customs’ lists. The basked includes meat products, fatty and oily products, fresh vegetables, garlic and onions. Studies were conducted in every relevant ministry to find out what we need, in addition to seeds, stone fruits, nuts, milk, tea, coffee, poultry and live animals. As for the subsidy price, as the governor said, it will be set at 3900 LBP as per the basic circular;products will be 100% subsidized, not 85% or 90%, in order for us to track prices from the importer to the consumer. We ask the importer and distributor to inform us of the quantity sold,the buyer, the selling price and the price sold to the consumer. Some foodstuffs’ prices have decreased in the primary basket, such as theEgyptian rice; in this new basket, we expect prices to decrease further and we will monitor them. We will track all information; whoever does not abide by this new agreement will not benefit from this subsidy, will be blacklisted and will be referred to the judiciary. Some dealers were blacklisted for violating our decision to support the first basket. They will not be able to import items based on the subsidized price in the second basket. We will control prices, impose penalties, and ask the citizens to inform us of any violation. We will announce on the Ministry’s website the materials that entered Lebanon and their prices for the consumer, industrialist, and farmer. Any citizen who feels that there is a violation must inform the Ministry of Economy in order for us to follow up on the case with the security forces, with the assistance of the Ministries of Agriculture and Industry. The intermediate circular will be issued tomorrow as the governor said. At the same time, we will send the decision to the Official gazette and it will be issued next Thursday. Merchants will start providing us with orders and all products carried by ships that are on their way to Lebanon will be at the subsidized price. We will check prices from their arrival at customs until they reach the consumer."
Nehme was asked about the profit margin for the importer and who determines it, and he said: "We will check import price, distributor price and consumer price with every importer. There is a crisis and we must all join hands to reduce its magnitude. We will be stringent with importers and traders."
Answering a question about when citizens will sense price difference in the markets, Nehmereplied: "In the first basket, the prices started falling within 3 days, such as the Egyptian rice, whose price has decreased from 20,000 to 10,000 LBP for the 5 kg. There are three types of requests: The first concerns the Ministry of Agriculture, the second concerns the Ministry of Industry, and the third is related to merchants and the Ministry of Economy; requests are examined and referred to the Ministry of Economy, which will track the prices. There is a unified operating room to double-check prices."
On the ministry’s ability to control subsidized materials’ speculation and smuggling, Nehme stated: “We chased several smugglers. 4 million Lebanese can notify the Ministry; we have inspectors, and the Ministry of Agriculture also has inspectors who will be conducting field inspection tours and will be touring stores and warehouses to force them fill their shelves.”
Nehme was also asked about financial losses-related figures; he replied: "This issue will not be tackled in the media, but is rather dealt with in closed rooms with the World Bank and specialists in Lebanon in order to reach solutions. Negotiations were not suspended."
As for the role of municipalities in prices’control, Nehme replied: "Municipalities, as other citizens, have a role and a judicial authority; they can assist us on the basis of new price lists that will be published on the Ministry's website."
Then, the Minister of Agriculture said: "We negotiated with the Prime Minister during the meeting the amendment, deletion or addition ofsome items, for we aim to achieve food stability and to encourage subsidized national agricultural and industrial production. We have faced obstacles and have overcome them. However, for this basket, agricultural inputs or food industry we will followed up through a team from 3 ministries and a joint operation room to monitor inputs from merchants, to shops, until the consumers. If there is no oversight of subsidized prices, this will lead to a crisis. Control as essential.”
Mortada was asked about the price of meat, and he said: "Certainly, the price of meat will decrease to 22,000 or 25,000 LBP. We will monitor the prices and we will practice accountability.
Later on, the Minister of Industry spoke, saying: "We regret that the government as a whole is concerned with this issue rather than taking care of things that require action as well. But our responsibility is to preserve the purchasing power of Lebanese citizens, support factories, industrialists and farmers, secure a competitive capacity for our industrial production, and export our products to attract dollars from abroad. We have identified the raw materials needed for food industries and supplements, in addition to some goods and products produced by our factories. The other important concern facing us is to control fraud, manipulation and monopolies. The goal is to secure the markets today and not later. We have established the list, and the mechanism that will be followed is flexible; we will take action on any errors and the mechanism might be amended. Every citizen will have to play the role of a watchman, and we will ensure follow up through security forces. I ask the judiciary to adopt stringent measures; in fact, in some places, the judiciary is defaulting.
Hoballah was asked about the types of subsidized industrial materials, and he said: "We will secure all the materials that are considered raw materials manufactured in Lebanon."-- PM Press Office