LIMS explained that the formation of a new government sent people rushing to sell their dollars, anticipating the LBP will increase in value. The extra supply of dollars in the market, although short-lived, drove the dollar exchange rate down, yet it cannot guarantee long-term monetary stability. The LBPs in circulation increased by a factor of 7 since the onset of the crisis in late 2019. So long as money printing persists, the Lebanese pound will resume its devaluation once again. 
For LIMS, it is unrealistic to expect the new government to be able to resolve the economic crisis, given the short 8-month mandate bounded by the upcoming parliamentarian elections. Therefore, Mikati’s cabinet should not focus on dividing reforms such as bank restructuring, since no political consensus is achievable in the short run. Instead, the effort should target low hanging fruits that can have a meaningful impact on the population, like completely lifting subsidies and ensuring monetary stability by adopting a currency board. LIMS recommended the currency board to be the pillar of a comprehensive plan presented to the IMF. Such a plan would also include restructuring the central bank, the sovereign debt, the public sector, as well as other vital areas like electricity. 

In fact, subsides lowered the fuel price, in turn incentivizing the smuggling and hoarding of the resource. This has resulted in electricity outages and long queues at gas stations. The fuel scarcity crippled all sectors of the economy and forced numerous hospitals, businesses, and industries to shut down completely. To add insult to injury, the central bank subsidy program (CBSP) was financed by people’s dollar deposits at commercial banks. Clients only had access to freshly printed LBP withdrawals from their USD accounts, enhancing the severe currency depreciation. 
With the new policy in place, the central bank that used to provide dollars for fuel imports at a subsidized amount will switch to the SAYRAFA rate starting October, which mirrors the black-market rate. LIMS recommended that the central bank’s involvement should only be temporary, before completely exiting the fuel market. Fuel importers, like all other importers, should turn to the market to secure the needed dollars.
LIMS has continued to urge the lifting of all subsidies without delay, even if the alternative cash cards haven’t been rolled out yet. LIMS went on to propose 2 solutions to the increased fuel prices: (1) establishing a currency board that stabilizes and strengthens the Lebanese pound, effectively lowering the cost of all commodities, and (2) improving the public transport sector by revising the corresponding laws, namely, to increase the number of licensed taxi plates, abolish the mandated taxi service fees, and allow private investments in the sector.

The Iranian ships, LIMS explained, will not solve the fuel problem, as no economic embargo restricts Lebanon’s ability to import fuel. As a matter of fact, Banque du Liban (Lebanon’s central bank) stated that it subsidized three times the local market’s need for fuel in July alone. The problem rather lies in the inability to have the imported fuel reach the population. Most of the imported quantities end up being smuggled to Syria where they can be sold for a higher profit margin. Ending the fuel crisis requires that the Lebanese government repeal the subsidy program and remove the price controls. Fuel prices must match the international market to stop incentivizing smuggling and hoarding. 
LIMS saw that the government missed an opportunity to lift subsidies once and for all, when it decided to prolong the program until the end of September, to coincide with the rolling out of cash cards. Despite subsidies going down from 70% to 50%, motivation to smuggle remains high. Unfortunately, Lebanon will still suffer from fuel shortages, until the price is at the real market level.