Lebanon: crisis, mass firings of bank employees

Financial default hits heart of banking system

08 April, 16:06

    Workers clean the broken glass outside a bank which was set ablaze by anti-government protesters in the northern city of Tripoli, Lebanon Workers clean the broken glass outside a bank which was set ablaze by anti-government protesters in the northern city of Tripoli, Lebanon

    BEIRUT - A year and a half after the de facto imposition of capital controls by the Lebanese banking cartel, amidst the worst economic crisis in the last 30 years and the country's financial default, banking institutions have begun a massive campaign to fire mid-to-low-level workers, said the union of Lebanese bank workers on Thursday.

    The union is calling on authorities to intervene to "put an end" to the campaign of "illegal firings" that Lebanese banking institutions began last fall.

    According to banking sources cited by the Lebanese daily L'Orient-Le Jour, the firings began quietly last year and took on significant proportions in November 2020.

    As of February 2021, it was estimated there had been a 20% decrease in the entire clerical sector, which numbered about 25,000 people at the end of 2019, when the crisis began to seriously emerge.

    In mid-November 2019 the main Lebanese banks, in agreement with the Central Bank, started limiting the access of small and medium-sized savers to their deposits in hard currency, mainly US dollars.

    Instead, the banks proposed using the savings in Lebanese pounds, which were exchanged at an increasingly disadvantageous rate.

    The local pound has lost nearly 90% of its value since October 2019, with a resulting price spike in consumer goods, mostly imported in dollars and euros, and in essential services, which are largely privatised.

    For the past 18 months, the headquarters of Lebanese banks have been targets of vandalism and attacks by fringe groups increasingly supported by a Lebanese populace frightened by the spectre of food insecurity.

    The UN estimates that over half the local population is now living under the poverty line.

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