On March 9, 2023, LIMS addressed the Arab Society for Social Security about Lebanon’s ongoing currency crisis. LIMS highlighted the country’s increasing money supply as the root cause of the collapse of the Lebanese pound (LBP) and criticized the managed float exchange rate regime for leading to further currency devaluation and inflation.

The money supply increase stems from two factors: financing the fiscal deficit and addressing the banking crisis. Despite the government’s attempts to increase taxes, its income is decreasing, making borrowing from international financial markets difficult after the default of the payment of Eurobonds. Additionally, the central bank borrowed billions of dollars from commercial banks, but most of the money was lost, leading the central bank to reimburse its debt to banks in LBP by increasing the money supply.

LIMS emphasized the urgent need to halt money printing, reform fiscal policy, and reduce government expenditures. Furthermore, opening the banking sector to competition is critical for addressing the banking crisis and stabilizing the economy.