Saudi Gazette report

RIYADH — Saudi Arabia’s decision to halt all Lebanese imports would deal a further blow to the sinking Lebanese economy. The financial losses caused by the import ban would be projected to around $244 million in a year, according to an official report of the Lebanese Chamber of Commerce, Industry and Agriculture.

Saudi Arabia ordered on Friday the Lebanese ambassador to the Kingdom to leave within 48 hours and banned all Lebanese imports in response to critical comments made by the Lebanese Information Minister George Kordahi about the Saudi-led Coalition to Support Legitimacy in Yemen.

Following the announcement, the Lebanese trade deficit is expected to rise sharply, and that the Lebanese economy would continue to show weakness and stay in deficit.

The chamber report showed that Lebanese exports to Saudi Arabia accounted for 8.25 percent of its total exports. The value of Lebanese exports reached $3.54 billion, of which $243.7 million were to Saudi Arabia. The chamber sees the Saudi market as the largest market to achieve additional exports for it during the year 2021.

In the beginning of this year, exports to Saudi Arabia amounted to $292.4 million, in addition to the presence of unexploited potential to achieve additional exports of $94.4 million, as the highest country to which exports can be raised in the current year, it was revealed in a review made by Okaz/Saudi Gazette.

The Lebanese currency has had to pay a big price for the ongoing political tensions and economic crisis in the country coupled with the latest developments.

A recent report by Bank Audi showed that the second quarter of 2021 recorded a decline in the exchange rate of the Lebanese lira to its lowest levels, with the decline of the external assets of the Bank of Lebanon to $20.6 billion, while those assets at the end of last year 2020 were about $24.1 billion, equivalent to a loss of $3.5 billion, in light of the continuing deficit.

The price of the currency collapsed in the black market during the second quarter, to exceed the dollar exchange rate of 17,000 Lebanese pounds, after the exchange rate at the end of 2020 was about 8,400 pounds per dollar, while the lira recorded its lowest level in the first quarter at the level of 23,000 pounds per one dollar.