The current government finally established the Electricity Regulatory Authority (ERA) in September 2025. LIMS argued that activating and empowering the ERA is the linchpin of any meaningful reform since under existing law, the ERA alone is empowered to license new entrants. For decades, the vacuum created by the ERA’s non-appointment effectively shut private firms out of legal generation and distribution, leaving illegal diesel generator operators to fill the gap.

This dysfunction has spurred a bottom-up transformation. As generator prices soared and Électricité du Liban (EDL) faltered, households, businesses, and municipalities quietly installed more solar capacity over the past five years. A de facto decentralised energy system has emerged, one that now outperforms the state utility. Local actors have experimented with hybrid solutions combining generators and renewables, alongside innovations in metering and bill collection that have delivered more reliable and competitively priced power. These community-based systems have offered immediate relief where the state has failed.

LIMS contends that the ERA’s strategic choice is stark: either engage with this reality and build reform from the bottom up, learning from models that have demonstrably worked in Lebanon, or revert to the top-down, central-planning approaches favoured by past ministers, which have repeatedly ended in failure. A strong ERA, LIMS argues, should immediately license successful local initiatives, impose modern technical standards, and encourage generator operators to converge towards compliance. Bringing these networks under formal regulation would open the door for EDL to sell electricity to them at wholesale rates, allowing them to distribute it retail while leveraging their superior collection rates. Solving the collection problem would provide EDL with the revenue needed to increase supply hours, ultimately reducing costs for consumers.

Such an approach would allow the sector to regenerate from the local level upward, without waiting for grand, unfunded national schemes to materialise. In essence, the ERA’s core mission should be to acknowledge private investment that has already taken place, foster competition, and raise standards across the parallel market by bringing it into the legal fold.

LIMS has firmly rejected these ideas, stressing that under Law No. 42 of 1986, the Banque du Liban (BDL) is barred from selling or encumbering its gold without parliamentary approval. Drawing on reserves in the absence of structural reform risks repeating the policy mismanagement that contributed to the loss of an estimated US80 billion over the past decade. Gold remains one of the few anchors of confidence in the domestic currency, particularly at a time when central banks worldwide are expanding, rather than liquidating, their bullion holdings.
 
Instead, LIMS contends that Lebanon’s best prospect for reviving the financial system lies in the establishment of a legally binding currency board to restore credibility to the Lebanese pound by ensuring full reserve backing. Such a framework would encourage domestic cash hoarders, expatriates, and international investors to convert dollars into local currency and redeposit them in banks, providing a critical liquidity lifeline. A formal currency board would also offer insulation against political shocks, security crises, and renewed pressures for fiscal monetisation, factors that have repeatedly undermined exchange-rate stability.
 
LIMS argued that a second priority is to unblock the flow of credit, which has been effectively frozen since the onset of the crisis. With firms unable to borrow to finance operations or expansion, productivity has deteriorated and growth prospects have dimmed. In the absence of agreement on burden-sharing for the financial losses, credit can still resume by allowing new banks to enter the market or by permitting existing lenders to issue loans to productive sectors and recover them in fresh-dollar. Restoring credit would stimulate investment, employment, and output.
 
Taken together, LIMS’s alternative blueprint, anchoring the exchange rate through a currency board and reopening credit channels, seeks to rebuild confidence and place Lebanon’s banking sector on a path to recovery.

LIMS explained that while these grievances reflect economic hardship, the state simply lacks the capacity to finance another round of salary adjustments. With salaries and associated benefits accounting for the vast majority of total expenditures, the state’s finances are effectively captured by an inflated and low-productivity bureaucracy. Additional wage hikes would deepen the deficit, fuel monetary expansion, drain foreign exchange reserves, and further erode the very purchasing power employees are seeking to protect.

LIMS added that any future adjustment to public salaries must be linked to productivity gains; it cannot be granted across the board to all employees equally. Lebanon cannot continue rewarding underperformance. On the contrary, individuals hired through political patronage, sectarian allocation of posts, and hiring practices detached from economic need should be dismissed. These long-standing practices have produced a civil service far larger than the country’s fiscal base can sustain.

Regarding the high cost of living, LIMS stressed that the solution is not raising salaries but dismantling public monopolies in electricity, water, telecommunications, and waste management—sectors where entrenched monopolies keep costs high and quality low. Opening these markets to competition is essential to reducing the cost of living, improving service delivery, and generating new employment opportunities.

Such measures would represent a sharp departure from Lebanon’s long-standing political economy, in which public employment has functioned as a social safety net and a tool of political loyalty rather than an instrument of effective governance. Yet without breaking this cycle, the budget will remain a symbolic exercise: a document that acknowledges the country’s crisis while leaving untouched the structural distortions that make recovery impossible.

Gold has become the primary refuge. As global prices surged in October, driven by central banks diversifying away from traditional reserve currencies, Lebanese households intensified their own rush toward gold as a store of value or a source of liquidity. The surge in domestic demand has strained local supply, raised costs and pushed many families to sell inherited jewellery or purchase gold on instalments to cope with everyday expenses.
 
Younger Lebanese increasingly favour Bitcoin seen as the “gold of the new generation”. LIMS noted several advantages to Bitcoin: global portability, insulation from political interference, and usability outside Lebanon’s fragmented banking system. Despite its volatility, Bitcoin has outperformed the Lebanese pound and all the savings products that banks promoted before the crisis. Those products ultimately inflicted heavy losses on depositors. The shift toward Bitcoin, LIMS argues, is the result of a deeper collapse of confidence in the monetary and financial framework.
 
This breakdown has reshaped the labour market as well. The collapse of formal employment and the sharp erosion of real wages have pushed thousands, particularly the young, into delivery work, gig labour and other part-time roles. The expansion of these low-skill jobs offers households quick liquidity but entrenches the cash economy. With most transactions conducted in cash, small businesses and informal workers remain entirely outside the digital payments system. Lacking financial integration, they are unable to scale operations, obtain credit or engage in any form of long-term economic planning.
 
The public sector has sought partial fixes. The Public Housing Bank’s decision to raise the loan ceiling to $100,000 aims to restore a path to home ownership. LIMS argues the previous cap was far too low, given that even rural housing prices exceed earlier limits. Still, the measure’s impact is constrained. Without functioning banks or stable incomes, many Lebanese, especially in suburban and rural areas, lack the earnings required to qualify for such financing.
 
Lebanon’s persistent reliance on cash has also drawn international scrutiny. After the country was placed on the FATF grey list, pressure intensified to curb illicit financial flows. Recent steps by the central bank and judiciary, including tighter monitoring of suspicious transfers, aim to address money laundering and terrorism financing, including networks linked to Hezbollah. LIMS stresses that alignment with global standards is crucial to restoring trust and attracting investment.
 
Ultimately, LIMS argues that Lebanon’s recovery depends on reviving and modernising its payment systems. Only a transition to a modern financial architecture can reduce the risks associated with the cash economy, strengthen governance, and encourage households to return to more balanced asset allocation rather than crisis-driven hoarding.

Lebanon’s Power Crisis: How Bottom-Up Reform May Succeed Where the State Has Failed

• How Does Renewable Energy Provide Independence For Lebanon? October 3, 2025: Beirut 24, Video interview (AR)
• Electricity In Lebanon: Decades Of False Promises And Temporary Solutions For A Permanent Crisis. October 8, 2025: Alhurra, Article (AR)       
• More Important Than The Circular Is The Seriousness In Its Implementation, And The Reason Behind The Electricity Crisis Is Very Simple: The State’s Incompetence And Mismanagement. October 13, 2025: El-Shark, Article (AR)
• The Generators Are Baiting The State… Will The Bill Decrease? October 14, 2025: Al Modon, Article (AR)
• Between Darkness And Light… Lebanon At A Crossroads. October 16, 2025: Alhurra, Article (AR)
• Electricity From Crisis To Solution: Solar Energy Through Public-Private Partnership. October 17, 2025: This Is Lebanon, Video interview (AR)
• Decentralization In Electricity… Will It End 30 Years Of Darkness In Lebanon? October 24, 2025: CNBC, Video interview (AR)
• Strengthening Electricity Cooperation Between Neighboring Countries: Jordan Is Ready… What About Lebanon And Syria? October 27, 2025: Annahar, Article (AR)

As Banking Crisis Persists, Lebanon Weighs Gold Use and a Shift to a Currency Board

• The International Monetary Fund: Lebanon’s Only Solution Or Its Biggest Problem? October 20, 2025: Transparency News, Video interview (AR)
• Is There A Glimmer Of Hope For The Future Of Lebanon’s Economy? October 21, 2025: Sawt El Shaab, Video interview (AR)
• After Two Years Of Stability, What Is The Fate Of The Lira’s Exchange Rate? October 25, 2025: Aljadeed TV: Video interview (AR)

Lebanon’s 2026 Budget Highlights a State Strained by an Oversized Public Sector

• Does The New Budget Entrench The Crisis Instead Of Solving It? October 3, 2025: NBN, Video interview (AR)      
• Lebanon Is Experiencing A Deep Structural Crisis, And Raising Wages Is Not A Solution But A Consequence. October 11, 2025: Nidaa Al Watan, Article (AR)
• What If Public Administration Employees Declared Civil Disobedience?! October 23, 2025: Al Markazia, Article (AR)
• Between The Clock And The Decision… Does Lebanon Even Need To Change The Time? October 24, 2025: Annahar, Article (AR)

Competition Before Contracts: Rethinking Lebanon’s Approach to Infrastructure

• The Partnership Between The Public And Private Sectors Saves Vital Sectors But With Clear Conditions. October 1, 2025: Aljadeed TV, Video interview (AR)
• “Speed” As An Excuse To Circumvent “Public Procurement”… While Competition Remains Key. October 28, 2025: Al Safa News, Article (AR)

• Is “Delivery” Becoming The Profession Of The Future In Lebanon? October 10, 2025: Independet Arabia, Article (AR)
• Is Bitcoin The Gold Of The New Generation… And Is Silver’s Comeback Near? October 10, 2025: Annahar, Article (AR)
• The Soaring Gold Prices Tempt The Pockets Of The Lebanese… It’s The Safe Yellow! October 20, 2025: Manateq net, Article (AR)
• Gold, The Dollar, And Cryptocurrencies: The Struggle For Global Reserves And The Future Of Monetary Trust: October 22, 2025: VDL News, Audio interview (AR)
• Is Gold Becoming The Key To Escaping The Economic Crisis In Lebanon? October 28, 2025: CNBC, Video interview (AR)
• Housing Bank Loans Stimulate The Real Estate Market Despite Crises And Boost The Hopes Of Low-Income Earners. October 30, 2025: Al Hadeel Magazine, Article (AR)
• How Is Lebanon Trying To Save Its Banking Sector From The Shadow Of Sanctions? October 31, 2025: Alhurra, Article (AR)