Lebanese increased 144% of consumer prices in September
Elected world champion of the inflation rate in September by the Bloomberg agency, Lebanon experienced an increase of 144.12 % in annual sliding of consumer prices for this same month, reaching 613.96 points (against 251,5 points in September 2020), according to the monthly consumer price index (IPC) calculated and published yesterday by the central administration of statistics (ACS).This is also an increase of 8.16 % compared to the previous month (567.65 points in August).The base (100) considered being that of December 2013.
Inflation in September therefore continued on its momentum in the context of economic and financial crisis that Lebanon has been going through for two years, thus ahead of Zimbabwe and Venezuela, according to Bloomberg, both also facing a depreciation of the national currency.Fixed at the dollar at 1,507.5 pounds, the Lebanese book has lost, since the start of the crisis at the end of summer 2019, 92.27 % of its value, on the basis of a dollar rate/book on theparallel market valued yesterday at 19,500 pounds per dollar.
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With a minimum wage still established at 675,000 pounds ($ 34.6 according to yesterday's rate), Lebanese not having foreign currency income is therefore simply condemned to poverty, which affects 78 % of the population according toThe latest evaluation of the ESCWA dating from early September.Those who have saved or who are still gaining from it are more likely to get out of it, or even to live comfortably, depending on the case, while waiting to see the impact on inflation that the total lifting will havefuel grants.This mechanism had been set up by the Bank of Lebanon (BDL) in October 2019.He started to be gradually lifted in the spring, a process that only ended this week.
Transport prices in mind
Unsurprisingly, the palm of the highest increase in prices last September comes to those of transport, with an increase of 356.91 % in annual shift and 31.29 % compared to the previous month, while the partial lifting of subsidieson fuels had accelerated in early September.In detail, gas, water, electricity and other fuels increased 18.86 % in monthly pace and 182.44 % compared to September 2020.ACS also has another clue targeted on fuel (diesel, used by private generators, certain vehicles or certain boilers in winter) which marks "an increase in September of 61.6 % compared to August", notes NassibGhobril, director of the economic research department of Byblos Bank.
For the economist, beyond inflation due to the crisis and the depreciation of money, several factors are to be taken into account, in particular and above all "that of the black petrol market" which flowed from theBeginning of the gradual lifting of subsidies, "in addition to the smuggling of subsidized products (towards Syria, editor's note), creating shortages in Lebanon," he explains.All against the backdrop of a "incapacity for Lebanese authorities to supervise retail prices, which certain players in the sector were able to increase in a non-proportional way with the exchange rate on the parallel market", he adds.
Usually published on Wednesday by the Ministry of Energy and Water, the new fuel prices for this week de facto ratified a total lifting of subsidies this week, exceeding the 300,000 pounds mark for 20 liters of gasoline(or more than $ 200 at the official rate).The fear of seeing an explosion of inflation in October as a result, however is relative, says Nassib Ghobril.Indeed, with the prices in pounds of fuel now calculated at the rate of the parallel market, "there is no longer a black petrol market", therefore resulting in a certain stability of these prices, like the price of1,000 liters of fuel oil bought by the owners of private generators who have increased this week of "only" 4 %, subsidies on this fuel having been lifted since September, against an increase of about 25 % in one week for the'petrol at 95 and 98 octane.
Monster costs to save the frozen
The increase in fuel prices is followed by that of a majority of consumer prices, the production chain by being intrinsically dependent."Until now, we have managed to provide 22 hours of electricity on generator within our five points of sale, having between one and two hours of public electricity per day," explains Zakaria Itani.A monster cost for this associated manager of the Beirut Shopper’s supermarket chain which, unlike some other competitors, has chosen to increase its electricity generation capacities to continue to keep frozen products."The day we can no longer ensure this system, we will stop selling it so as not to endanger the health of our customers," he said.
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Customers who "buy less and less products and have rightly become extremely sensitive to prices", underlines the young man, adding the inability for him and his team to project themselves over a month, "inflationbeing one thing, constant political instability and surprise announcements of our leaders being another ”.In fact, political events influence the market rate.In the wake of the formation of the government of Nagib Mikati in early September, the dollar/book rate had gone from 19,000 to 14,000 pounds in a few days before going back to almost 18,000 before the end of the same month.
According to the ACS index, food prices and non -alcoholic beverages increased by 280.86 % in September in annual sliding and 9.31 % in monthly pace, while those of alcoholic drinks andtobacco increased from 213.72 % and 7.06 % in September according to these same rhythms."If customer purchases are increasingly targeted, according to their budget, we have also reduced our volumes and import (paid in dollars, editor's note) of certain products and privileges for example more and more Lebanese products",explains Zakaria Itani again.
The fuel prices explode in Nabatiyé
In other categories, ACS indicates that last September the prices of restaurants and hotels increased from 293.36 % in annual shift and 5.78 % in monthly rhythm.Over the same period and at the same rhythms, health care increased by 212.08 % and 2.9 % and those of culture and leisure activities increased by 106.94 % and 1.57 %.Two drops in monthly rhythm should be noted for clothing (- 3.05 %) and communication means (- 1.12 %).Both, however, increased by 165.96 % and 32.38 %, respectively, in annual sliding.
In terms of regions, prices in September increased in monthly rhythm in all the country's mohafazats, starting with the Nabatiye region (11.51 %), followed by those of Békaa (9.6 %), Lebanon-Sud (9.07 %), capital (8.51 %), Lebanon-North (7.64 %) and Mont-Lebanon (7.41 %).In the fuel category, it is also in Nabatiyé that ACS notes a greater price increase with a total of 35.24 %, against a lesser in Mont-Lebanon with 11.58 %.Regarding food prices and non -alcoholic drinks, it was in Beirut that the increase was more severe (25.1 %), against an average stable under 10 % for all othersregions.Transportation costs have however increased in each of them, turning around 30 %.
If we can expect consumer prices once again crescendo in October, "September having been the 15th consecutive month of a three -digit inflation rate, since July 2020 therefore", recalls Nassib Ghobril, "The responsibility of the authorities to supervise these prices" remains one of the prerogatives necessary to try, as best they can, to control the curve.For Zakaria Itani, it seems obvious that the Lebanese company is moving towards a new "dollarization", that is to say increasingly calculated on the basis of the market rate - a point also raised in our columns yesterday by the associationconsumers -.At least, until the government finds a solution to stabilize this rate or set a new parity between the pounds and the dollar.
