Lebanese pound
LL 1,000 note, using Arabic on the obverse and French on the reverse
ISO 4217
CodeLBP (numeric: 422)
Subunit0.01
SymbolNone official. The abbreviation LL or ل.ل. is used
Denominations
Subunit
1100piastre
BanknotesLL 1,000, LL 5,000, LL 10,000, LL 20,000, LL 50,000, LL 100,000
CoinsLL 250, LL 500
Demographics
User(s) Lebanon
Issuance
Central bankBanque du Liban
 Websitewww.bdl.gov.lb
Valuation
Inflation177.25%
 Sourcehttps://economics.creditlibanais.com/Article/212047#en
Pegged withU.S. dollar[1]
note
note Dual exchange rate system (Sayrafa) in effect as of June 2021

The lira or pound[a] is the currency of Lebanon. It was formerly divided into 100 piastres (or qirsh in Arabic) but, because of high inflation during the Lebanese Civil War (1975–1990), subunits were discontinued.

The plural of lira is either lirat (ليرات līrāt) or invariant, whilst there are four forms for qirsh: the dual qirshān (قرشان) used with number 2, the plural qurush (قروش) used with numbers 3–10, the accusative singular qirshan (قرشًا) used with 11–99, and the genitive singular qirsh (قرش) used with multiples of 100. The number determines which plural form is used. All of Lebanon's coins and banknotes are bilingual in Arabic and French.

From December 1997 through January 2023, the exchange rate was fixed at LL 1,507.50 per US dollar.[4] However, since the 2020 economic crisis in Lebanon, exchange at this rate was generally unavailable, and an informal currency market developed with much higher exchange rates.[5] On 1 February 2023, the Central Bank reset the currency peg at LL 15,000 per US dollar.[6] By mid-March 2023, the "parallel market" rate had fallen to LL 100,000 per dollar.[7]

History

See also: History of Lebanon § League of Nations Mandate (1850–1939)

Until World War I, the Turkish pound was the currency used in the area. In 1918, after the fall of the Ottoman Empire, the Egyptian pound was used. Upon gaining control of Syria and Lebanon, the French replaced the Egyptian pound with a new currency for Syria and Lebanon, the Syrian pound, which was linked to the franc at a value of LS 1 = 20 F. Lebanon issued its own coins from 1924 and banknotes from 1950.[citation needed] In 1939, the Lebanese currency was officially separated from that of Syria, though it was still linked to the French franc and remained interchangeable with Syrian money. In 1941, following France's defeat by Nazi Germany, the currency was linked instead to sterling at a rate of LL 8.83 = GBP1.00[8] A link to the French franc was restored after the war, but was abandoned in 1949.

Before the third phase of the Lebanese Civil War, USD1 was worth:

In 1986, the pound began falling against the dollar. On 13 June, a dollar was worth LL 36.50. Two weeks later, it was worth LL 47.[9]

During the Civil War, the currency depreciated rapidly until 1992, when one US dollar was worth over LL 2,500. Subsequently, the government attempted to peg the currency: from December 1997 until February 2023,[12] the official rate was fixed at LL 1,507.50 = USD1.00[4]

In August 2019, due to the increasing supply of Lebanese pounds in the economy, pressure on the fixed exchange rate with the US dollar started, creating a parallel market rate.[citation needed] In March 2021, the free market rate in Beirut was LL 10,000 = USD1.00[13] By July 2021, it was around LL 24,000 to the dollar.[14] On 18 March 2023, the value of the Lebanese pound dropped in the free market to LL 111,000 against the US dollar, its lowest value ever.[15]

On 10 May 2021, the Lebanese Central Bank (BDL) announced the launch of the "Sayrafa" platform, an electronic platform intended to record all Lebanese Pounds foreign exchange transactions and identify the exchange rates at any point in time.[16] The platform was launched in June 2021 and became the official USD-to-lira exchange rate for all credit card transactions on 1 February 2022.[17] In March 2023, the Sayrafa exchange rate became 43% less than the unofficial, free market rate.[18]

Panorama of city with mixture of five to ten story buildings
USD to Lebanese Lira exchange rate

Coins

Lebanon's first coins were issued in 1924 in denominations of 2 and 5 piastres (p). Later issues did not include the word "syriennes" and were in denominations of 12p, 1p, 2p, 2+12p, 5p, 10p, 25p and 50p. During World War II, rather crudely made 12p, 1p and 2+12p coins were issued. Before the war all coins were minted in Paris.[19]

After the war, the Arabic spelling was changed from girsh (غرش) to qirsh (قرش). Coins were issued in the period 1952 to 1986 in denominations of 1p, 2+12p, 5p, 10p, 25p, 50p and LL 1. No coins were issued between 1986 and 1994, when the current series of coins was introduced.

Coins in current use are:[20]

Coins of the Lebanese pound
Image Value Technical parameters Colour Date of
issue
Obverse Reverse Diameter Thickness Mass Metal
Coins no longer in circulation[21]
5p Aluminium-bronze 1924
5p Aluminium-bronze 1925
1931
1933
1936
1940
50p 10 g Silver 1929
1933
1938
5p 18 mm 2.2 g Copper-nickel-aluminium Golden yellow 1968
1969
1972
1975
10p 21 mm 3.2 g Copper-nickel-aluminium Golden yellow 1968
1969
1970
1972
1975
25p 23.5 mm 4 g Nickel-brass Golden yellow 1968
1969
1970
1972
1975
1980
50p 24 mm 6 g Nickel White nickel 1968
1969
1970
1971
1975
1978
1980
LL 1 27.5 mm 8 g Nickel White nickel 1975
1977
1980
1981
27 mm 7.22 g Nickel-plated steel White nickel 1986
Coins in circulation[20]
LL 25 20.5 mm 1.3 mm 2.8 g Nickel-plated steel White nickel 2002
LL 50 19 mm 1.15 mm 2.25 g Stainless steel White nickel 1996
LL 50 21.5 mm 1.67 mm 3g Nickel-plated steel 2006
LL 100 22.5 mm 1.80 mm 4 g Zinc and copper Red copper 1995
1996
2000
LL 100 22.5 mm 1.83 mm 4 g Steel and nickel White 2003
LL 100 22.5 mm 1.80 mm
1.60 mm
4 g Steel and copper Red copper 2006
2009
LL 250 23.5 mm 1.82 mm 5 g Copper and aluminium Yellow gold 1995
1996
2000
2003
1.65 mm Nordic Gold Nordic Gold 2006
2009
2012
LL 500 24.5 mm 2.05 mm 6 g Nickel-plated steel White 1995
1996
2000
2003
2006
2009
2012
For table standards, see the coin specification table.

By January 2023,[citation needed] the only coins in use are the 250- and 500-pound ones. The other lower-value coins are worthless now due to hyperinflation.

Banknotes

This section needs expansion with: Obverse and Reverse presentations on the listed notes. You can help by adding to it. (September 2023)
LL 100 note of the 1964 series

Lebanon's first banknotes were issued by the Banque de Syrie et du Grand-Liban (Bank of Syria and Greater Lebanon) in 1925. Denominations ran from 25 piastres through to LL 100. In 1939, the bank's name was changed to the Bank of Syria and Lebanon. The first LL 250 notes appeared that year. Between 1942 and 1950, the government issued "small change" notes in denominations of 5p, 10p, 25p and 50p. After 1945, the Bank of Syria and Lebanon continued to issue paper money for Lebanon, but the notes were denominated specifically in "Lebanese pounds" (ليرة لبنانية, livre libanaise) to distinguish them from Syrian notes. Notes for LL 1, LL 5, LL 10, LL 25, LL 50 and LL 100 were issued.

The Banque du Liban (Bank of Lebanon) was established by the Code of Money and Credit on 1 April 1964.[22] On 1 August 1963 decree No. 13.513 of the "Law of References: Banque Du Liban 23 Money and Credit" granted the Bank of Lebanon the sole right to issue notes in denominations of LL 1, LL 5, LL 10, LL 25, LL 50, LL 100, and LL 250, expressed in Arabic on the front, and French on the back. Higher denominations were issued in the 1980s and 1990s as inflation drastically reduced the currency's value.

Banknotes in current use are:

Circulating banknotes[23]
Image Value Dimensions Main colour Date of issue
Obverse Reverse
LL 1,000 156 × 67 mm Teal 1988
1990
1991
1992
115 × 60 mm 2011

2012

2004

2008

LL 5,000 156 × 67 mm Pink 1994
1995
140 × 70 mm 1999
2001
120 × 62 mm 2004
2008
2012
LL 10,000 145 × 73 mm Yellow 1998
127 × 66 mm 2004
2008
2012
LL 20,000 150 × 80 mm Red 1994
1995
2001
130 × 72 mm 2004
2012
LL 50,000 150 × 80 mm Blue 1994
1995
1999
2001
140 × 77 mm 2004
2011
2012
LL 100,000 161 × 90 mm Green 1994
1995
1999
2001
147 × 82 mm 2004
2011
2012
135 x 66mm Green 1 December 2023
For table standards, see the banknote specification table.

All current notes have a French side, which uses Western Arabic numerals, and a Modern Standard Arabic side, which uses Eastern Arabic numerals. The French side has a serial numbers written in two ways: one is in Arabic script and Eastern Arabic numerals, and the other is in the Latin script and Western Arabic numerals.

Higher denominations

With the highest bill of LL 100,000 worth less than $1 ( 90 cents ) there have been proposals to issue a LL 500,000 and latter on a LL 1,000,000.[24][needs update]

Devaluation

Main article: Lebanese liquidity crisis

On 1 February 2023, Lebanon lowered its official exchange rate for the first time in 25 years, reducing it by 90%.[6] Despite this significant change, the local currency remains considerably undervalued compared to its market value.[25] A popular saying, "There is no value," is commonly used to refer to the substantial price changes that have characterized daily life since late 2019.[26] Ever since, the exchange rate had forked into multiple distinct rates due to Lebanon's banking sector collapse. Within six months, five distinct Lebanese pound rates were defined against the US dollar, officially and unofficially. They were valued at:

The parallel (or black) market rate is significantly higher than the official exchange rate.[citation needed]

Lollar

The "lollar" is a deposit denominated in US dollars in the Lebanese banking system. It is a nominal balance stuck or frozen in the Lebanese banks, with currency value simply as a computer entry. The lollar is not a tangible currency, but is a concept of an outstanding deposit in US dollars in Lebanese banks that can only be withdrawn in Lebanese pounds at a very reduced set rate[31] and considerably lower than the highly speculative black market rate, which is multiple times higher. There are also limits put on the total amount that can be withdrawn on the lollars.[32] The term was coined by Harvard University economic fellow Dan Azzi[33] after the Lebanese banks suffered serious difficulties and restricted the amount of US dollars and other foreign currencies they could pay to their depositors.

Causes and Effects of the Economic Crisis

The Lebanese financial crisis drew widespread attention in October 2019, as numerous Lebanese citizens took over the streets and initiated the "Thawra" protest. Nevertheless, the economic predicament had been deteriorating for several years.[34] The central bank implemented rigorous restrictions on withdrawals from foreign exchange accounts as they encountered significant difficulties in maintaining the value of the lira. This affected approximately 75% of all bank deposits. The major cause of the economic crisis was the implementation of the de facto capital controls, which greatly impacted the financial stability of the country.

The crisis had various effects on Lebanon and its people. They have encountered several challenges over the last few years, including the introduction of extra official rates for specific transactions, hyperinflation, a sharp decline in the gross domestic product (GDP), which resulted in shutdown of businesses and a higher rate of unemployment. Additionally, Lebanon faced the impact of the COVID-19 pandemic, which was then followed by the devastating 2020 Beirut explosion on August 4, 2020. It resulted in the loss of thousands of lives, injuries, and the destruction of the capital city, Beirut.[35]

Transitioning to the U.S. dollar as the official currency is seen as an essential measure to address the ongoing severe crisis.[36]

See also

Current LBP exchange rates
From Google Finance: AUD CAD CHF CNY EUR GBP HKD JPY USD JPY USD
From Yahoo! Finance: AUD CAD CHF CNY EUR GBP HKD JPY USD JPY USD
From XE.com: AUD CAD CHF CNY EUR GBP HKD JPY USD JPY USD
From OANDA: AUD CAD CHF CNY EUR GBP HKD JPY USD JPY USD

Notes

  1. ^ Arabic: ليرة لبنانية, romanizedlīra Libnāniyya; French: livre libanaise; abbreviation: LL[2] in Latin, ل.ل. in Arabic, historically also £L,[3] ISO code: LBP

References

  1. ^ "About Banque du Liban | History of Banque du Liban". www.bdl.gov.lb. Retrieved 13 June 2016.
  2. ^ "World Bank Editorial Style Guide 2020 - page 136" (PDF). openknowledge.worldbank.org. Retrieved 2022-08-01.
  3. ^ "Lebanon". CIA World Factbook 1990 - page 178. 1 April 1990. Retrieved 2022-06-21.
  4. ^ a b c "Economic & Financial Data". Banque du Liban. Archived from the original on 2013-03-12. Retrieved 2013-02-10.
  5. ^ "Lebanese banks raise USD withdrawal rate to 3,850 pounds/dollar". Reuters. 29 June 2020. Retrieved 1 July 2020.
  6. ^ a b "Lebanon devalues official exchange rate by 90%". Reuters. February 1, 2023. Retrieved February 3, 2023.
  7. ^ "Lebanon's currency value plunges to 100,000 against US dollar". Al Jazeera. 14 March 2023. Retrieved 21 March 2023.
  8. ^ "Payment Media, Banknotes and Coins – The Historical Development of the Lebanese Pound". Banque du Liban. Archived from the original on 2008-12-26. Retrieved 2008-12-31.
  9. ^ Middle East International No 277,278, 13,27 June 1986 Publishers Lord Mayhew, Dennis Walters MP; Jim Muir pp.4-6,7-8. Muir uses the words 'unthinkable' & 'incredible'.
  10. ^ Middle East International No 315, 19 December 1987; Jim Muir pp.6-7
  11. ^ Middle East International No 291, 9 January 1989; Jim Muir p.4
  12. ^ "Lebanon devalues official exchange rate by 90%". Reuters. 2023-02-01. Retrieved 2023-03-21.
  13. ^ "Protesters shut down roads as Lebanon pound hits all-time low". France 24. 2021-03-03. Retrieved 2021-03-05.
  14. ^ Lebanon currency drops to new low as financial meltdown deepens
  15. ^ Kareem Chehayeb (26 May 2022). "Value of Lebanese pound drops to all-time low". Al Jazeera.
  16. ^ "BDL circular on the "Sayrafa" Platform". 11 May 2021.
  17. ^ "Sayrafa rate becomes standard transaction rate for international, fresh dollar cards used in Lebanon". L'Orient Today. 2 February 2022.
  18. ^ "Value of Lebanese pound drops to all-time low". LBPRate.
  19. ^ Bruce, Colin R; Michael, Thomas (2007-06-11). 2008 Standard Catalog of World Coins 1901-2000. Krause Publications. pp. 1348–1349. ISBN 978-0-89689-500-3.
  20. ^ a b "Coins in Circulation". Banque du Liban. Retrieved 26 September 2020.
  21. ^ "Coins Out of Circulation". Banque du Liban. Retrieved 26 September 2020.
  22. ^ Linzmayer, Owen (2012). "Lebanon". The Banknote Book. San Francisco, CA: www.BanknoteNews.com.
  23. ^ "Banknotes in Circulation". www.bdl.gov.lb. Banque du Liban. Retrieved 26 September 2020.
  24. ^ "LBP 500,000 banknote to be printed soon". mtv Lebanon. 23 March 2023.
  25. ^ "Lebanon devalues official exchange rate by 90 percent". Al Jazeera. Retrieved 2024-03-29.
  26. ^ "Google Scholar". scholar.google.ae. Retrieved 2024-03-29.
  27. ^ Gebeily, Maya (2023-02-01). "Lebanon devalues official exchange rate by 90%". Reuters. Beirut. Retrieved 2023-02-05.
  28. ^ "Press Room". Banque du Liban. Retrieved 2023-03-14.
  29. ^ Loto, Emirates. "Compare Today's Rate | USD/LBP - الدولار اليوم | Lira Exchange | Lebanon". www.lira-rate.com. Retrieved 2024-03-29.
  30. ^ "Conversion rate for united states dollar to lebanese pound". www.google.com/finance. Retrieved 2024-05-22.
  31. ^ Heidi Moura (July 19, 2020). "Lebanese 'Lollars' – How American Currency Has Become The Face Of A Country's Downfall". The Organization for World Peace. Retrieved March 16, 2021.
  32. ^ Khalife, Leyal (16 January 2020). "'LOLLAR' At Me: A term coined after the fall of the Lebanese banking system". Stepfeed. Retrieved March 17, 2021.
  33. ^ Lazkani, Souad (January 25, 2021). "Lebanese Filmmaker Says You Can Change 'Lollars' To Dollars By Investing In Movies". the961.com. Retrieved March 16, 2021.
  34. ^ "The History of the Lebanese Financial Crisis". www.annahar.com. Retrieved 2024-03-29.
  35. ^ Makdisi, Amine; Razan, Samir (August 2022). "Lebanon's Multifaceted Economic Crisis of October 2019: Causes, Repercussions-A diagnosis" (PDF). ERF Working Papers Series: 5.
  36. ^ Amer, Aaed (2022-04-01). "Should the Lebanese Economy Be Fully Dollarized? Lessons from Panama and Liberia". Management Studies and Economic Systems. 7 (1/2): 25–35. ISSN 2408-9583.