Lebanon is facing a full economic meltdown and is virtually on a precipice economically, politically and socially. Although it cannot yet be described as a failed state, it is on the verge of becoming one.
A failed state can be described as a state that cannot protect its borders, cannot govern all the people on its territory, cannot provide basic utilities and services and does not have a monopoly on the use of force or police itself.
Lebanon is very close to fulfilling all these characteristics, as there are strong and well-armed groups – such as the Iranian-backed Hezbollah- which act as a state with a state in parts of the country, arresting and imprisoning citizens, while the government is unable to police all the territory of the country or provide essential services such as water and electricity which is supplied only three to four hours a day.
The value of Lebanon’s currency – the Lebanese pound- has lost more than 95 per cent of its value, compared to pre-crisis levels and now 35.300 Lebanese pounds are equivalent to one dollar, while in the not-too-distant past people were using dollars and Lebanese pounds interchangeably.
A combination of events brought Lebanon to the cliff’s edge. The Syrian Civil War dealt a heavy blow on Lebanese exports to Arab countries, while more than 1 million Syrian refugees sought shelter in Lebanon.
Then the coronavirus decimated its tourist industry, while the Central Bank catastrophically implemented unrealistic exchange rates and spend hundreds of millions of dollars to support the Lebanese pound. Public services, such as electricity, education, and healthcare, have been severely curtailed.
In contrast, the State has stopped subsidizing essential medicines, resulting in the untimely deaths of scores of people who no longer afford to buy them.