Why does one Big Mac cost you almost $20 right now in Lebanon. If i exchange
my US dollars at the official exchange rate. The shock you see when you go into a store. But
it's not that simple it keeps on going up and up because here there is a massive economic crisis.
Our pockets are drained our emotions are drained. if nothing changes some say Lebanon could become
a bankrupt failed state kind of like Venezuela. I've just landed in Beirut and unlike my last trip
just a year and a half ago i've been told not to get money from ATMs, not to use any credit cards.
In fact I've been told a lot of things. Everyone in Lebanon. Don't
pay with your credit card don't pay cash. Guess what guys I don't have lebanese lira
when I'm in another country pay on my credit card on your credit card seven times higher.
Okay I'll say your name. Listen what's the rate what's the rate.
He's giving 11 000. he's gonna you told me to tell you
Every few hours it changes? What is the difference between the black market and the official
exchange. Listen, definitely don't let people know you're American.The
only way for me to actually afford stuff here is to exchange my us dollars on what's called
the black market exchange rate. So remember that Big Mac right now in
Lebanon there are basically three rates: at the official exchange rate it would cost me
nearly $17. At the bank rate which is a temporary depreciated rate set by lebanon's central bank it
would cost me close to seven dollars. But at the black market exchange rate it costs two dollars.
Usually when I land in a new country I always go to an ATM to get the local currency,
but if I were to do that here a simple lunch could cost me as much as one hundred dollars.
It's so funny like i'm gonna have if i put it down put it down
So basically the exchange rate that I just got was one dollar for every twelve thousand
three hundred lira, which means for 50,000 lira this is about.. yeah four dollars? Okay
even with a university degree in finance I'm still confused but to make this simple
let me show you the difference in prices right now between the two different rates. Now i understand
why everyone told me do not pay in dollars do not pay with your debit card. If I were to pay
in us dollars this would cost me $90. With the money that I exchanged, it cost me less than $12.
10 minute uber ride: 80 cents // seven dollars. Pesto pasta with chicken: five dollars // forty
two dollars. One dunkin donut: fifty cents // four dollars sixty cents. Chicken kebab wrap:
two dollars // seventeen dollars. The Lebanese currency has lost
90 percent of its value and Lebanon imports a lot of stuff from other countries which means
it now takes a lot more cash to get the exact same stuff from abroad. Some restaurants are
now even giving the option between imported fries or domestic fries, and unsurprisingly
imported or fifty percent more expensive. Prices of everyday things are now as much
as ten times more expensive for those making their living here.
Every day here is a struggle. If you want to buy four better to pay now 35,000
in the past we paid three thousand. We see a phenomenon called runaway inflation
where you actually don't know where the currency is going to cap it keeps on going up and up.
When you go into a store and you see basic things that are
needed by people, let's say milk for children or like diapers, all of these necessities that
people can't live without become so expensive. But if you're visiting this country now with
dollars or euros it's the opposite of expensive. During my trip here a year and a half ago drinks
at bars and clubs were as pricey as New York or Hong Kong, but now prices are
some of the cheapest I've experienced. So how exactly did all this happen?
$140 billion. None of it exists anymore. So the wealth
of three four generations disappeared overnight. Lebanon's banking system collapsed at the end of
2019, everyone's life savings were frozen people basically lost their money until
further notice, told their money is frozen in bank accounts and that they can't access it.
all you've built in a lifetime in one year it's just gone.
My dad did he worked so hard like late nights and everything for us to have
everything we wanted so it's kind of hard for them especially at an old age to accept what's
happening because it's as if they were wrong. It was a huge spongy scheme on on a national
level all the money went to like the the people that were in power
and they they're all in foreign bank accounts. Adding to this banking crisis there was social
unrest, COVID-19 and a massive explosion which left many injured homeless and out of work.
After the banks reopened, we started having the unofficial capital control so
we couldn't withdraw our money from the banks it was really catastrophic.
This might explain why there are so many currency exchange rates. Earlier i told you there were
three but because the black market isn't backed by anything you actually have a lot more than that.
The value is whoever decide whoever you're transacting is why
there's no value there's no economy. That's Samer, a Lebanese who's behind the website
lebaneselira.org. It provides exchange rates based on daily trackers of money market indicate.
The basic value of money it has to be backed up with something
you need an economy you need government you need sentiment you need activity you need there's
none of that the country collapsed in 2019. Exchange rates change every few hours all this
means that if you're a store here it can be an absolute nightmare to keep up with prices.
This store tells me that it has to change price tags like this every three days. So this store
pretty much just gave up on putting prices on the items they actually have QR codes where they
where the store attendant will actually scan it and tell you what the price is probably
again because the price is changing so often. Everywhere in the world like the main problem is
COVID, right? And here it's the least of our problems.
Lebanon's minimum wage was 450 dollars per month before the crisis. Today,
it's less than sixty dollars per month. That's about three dollars per day. Everyone I speak
to here is frustrated. Many are going abroad if they have the means to do so and no one
hesitates to point their blame at the government. They are incompetent there's a lot of corruption
and greed as well and i think this is the deepest hole that's not letting us get out of the crisis.
We're not seeing any initiatives to make things better this is where our hopelessness stems.
The black market rate is causing massive hyperinflation.
The government is hoping to crack down on what's happening but even the governor of lebanon central
bank told the president that he cannot control the rise in the exchange rate in the black market
nor intervene in the currency market saying it's basic supply and demand
and he doesn't have the ability to intervene. I don't see a way outside of it right now but
I don't know if it's because we're so it has affected us to a point where we're hopeless.
Lebanon has been through a lot before. Civil war social and political unrest.
I really hope we can get out of it at any point but that may be too optimistic, realistic.
We are people of resilience, of excellence, as they say. We are made to be resilient we have
been passing through every single chess. It's one reason why its people
here are so often called resilient. I think resilience is really good on the short
term but lebanon has suffered too much i think. It's the whole phoenix lebanese resilience
thing i personally don't believe in this because history has been repeating itself.