Rayan Kassem

Group (2)

Lebanon: An Interlinked Economic and Food Crisis

Lebanon’s current economic crisis has led to a number of factors leading to food insecurity throughout the country. In September 2019, a revolution commenced as a result of people losing trust in the political and banking system. As people rushed to remove their money from the banks, they soon realized that the banks have been investing their capital with the central bank that no longer has the capacity to repay the banks their invested capital nor interest let alone provide subsidies for essential needs as well. The result was a financial crisis that led to the economic collapse the Lebanese people face today. With a country depending highly on imports of all categories of products due to a weak industrial and agricultural sector, the lack of fresh U.S. dollars means that the import of basic needs such as fuel, wheat, gasoline, and medicine can no longer supply the demand needed. Simply put, the government does not have enough money anymore to import its basic needs and the drop in the country’s currency value means that the price of all products is now much higher.

Lebanon’s long political situation and systemic corruption along with Beirut’s nuclear explosion on August 4th, 2020 exacerbated the situation even further.

The Lebanese people now live on the lowest wage in the world at $30/month, a few hours of electricity a day, a lack of medicine in pharmacies, a lack of gasoline for transportation, a lack of natural gas, and an inflation of prices. All of these problems combined have led to a food security crisis spanning from food poisoning to the disappearance of food products such as bread and others.

The following are links between food security and the economic crisis in Lebanon:

The Electricity Situation

The supply of electricity in Lebanon has never been 24/7. Before the economic collapse, electricity provided by the government’s power plants used to be cut off between 3 and 12 hours per day. The Lebanese people have been supplying themselves during the cut-off periods through the use of private generators. As the government’s ability to provide electricity and subsidize fuel for private generators decreased, electricity cut-off has now reached between 12 and 22 hours per day. There are disparities among who is able to get more hours of electricity per day depending on a number of factors.

The increased cut-off periods have now led to worse food quality due to poor storage. As food is now refrigerated properly for fewer hours, food poisoning from E.coli is on the rise, especially from dairy products and meats. This means that every citizen that is either eating out or buying food from the retail shop especially when it comes to cheese, ice cream, meats, and other products that are susceptible to rotting is now at risk. This also means that citizens can no longer store food in their refrigerators. Many citizens now buy food on a daily basis because they cannot store food. This is a problem given that many people have busy lives, that the prices of food increase weekly, and that the supply of food might suddenly decrease. Citizens are now left with two options; either they risk having their food rot in the fridge without electricity (having to throw away food is also a loss of money) or risk being food insecure due to high prices or loss of supply in the near future.

Plummeting Food Prices

The prices of food in Lebanon have now skyrocketed. Food import dependence and loss of Lebanon’s currency value have led to an increase in food prices. The supply of meat, dairy, wheat, rice, nuts and seeds, oils, and other basic food products is mostly imported from other countries. The prices have even increased for local food products such as fruits, vegetables, and legumes because the retail owner’s expenses have increased in general.

                                    Source: Gourmet

For example, the price of one kilogram of bananas used to cost 1,000 Lebanese Lira (L.L.). It now costs more than 1,000% of its initial price. The price of 1 kilogram of tomatoes increased from 1,000 L.L. to 8,000 L.L., that of potatoes from 1,000 L.L. to 7,000 L.L., and rice from 3,000 L.L to 30,000 L.L.

With over 70% of the Lebanese population living in poverty and the Lebanese cuisine depending largely upon a variety of plant-based foods, many families cannot afford anymore to provide their families with three meals per day. Some typical restaurant meals are now considered luxury dining to some people.

Subsidized Food Smuggled

Smuggling of subsidized fuel, medicine, and food has been on the rise since the crisis. Many subsidized food products have been exported to countries in Africa and South America. Some of these products include processed cheese, coffee, milk, tuna, sugar, and cooking oil that the government decided to subsidize. Despite the criticism on which foods should have been subsidized based on their nutritional adequacy, the main concern was preventing the smuggling of any of these products. Smugglers sell the subsidized products in order to obtain fresh U.S. dollars making more money than if they would have sold them within the country.

Shortage of Wheat and Bread

              Source: Luke Martin (YouTube)

The Lebanese cuisine depends largely on the use of Arabic bread. The supply of bread has decreased for several reasons. As the financial crisis worsened, the central bank was no longer able to provide U.S dollars to import the demand of wheat needed. The electricity cut-off also meant that the machines producing bread could not be operated as much as needed.

A third reason is retailers increasing the price of bread even with the subsidies provided by the government. The result is the occasional disappearance of Arabic bread from the market. Other wheat-based products had no shortened supply because their demand was not high. I\Bread in general is central in the Lebanese diet, especially for those who are poor and have large families to feed. Without the constant supply of bread at an affordable price, poor families will be forced to look for substitutes or face hunger.

With the ongoing crisis for two years and with no formulation of a government foreseen, food insecurity will continue if not worsen in Lebanon. The government’s adaptation strategies at the moment are to subsidize certain food products with the remaining capital left in the central bank and to provide monthly food aid to those most in need. But with the central bank’s diminishing capital due to no new reforms, both these strategies will soon no longer be available. The result will be a humanitarian crisis that has already begun.

The Lebanese people have already begun calling upon foreign nations and the United Nations for humanitarian assistance. There is fear that if foreign aid is given as monetary assistance to the government, it will be lost due to corruption. There is also concern that the United Nations’ solution will be to provide humanitarian assistance in terms of food aid; something that has been described as a “band-aid solution”.

The Lebanese situation needs a systemic and holistic governmental restructuring of its political and administrative operations. A government that is not able to provide fuel, medicine, water, or gasoline won’t be able to uplift its citizens from food insecurity. All governmental sectors in Lebanon are highly dependent on imports. If the government cannot generate U.S dollars from its internal sectors through exports or services, then it will no longer be able to import its basic needs. The economic collapse has meant that the currency value of salaries in the Lebanese Lira is now worth a few meals. With no future increase in salaries and wages, food affordability will decrease tremendously leading to hunger and famine.

The situation in Lebanon is a reminder that food systems are part of other interlinked systems. If one or more of these systems collapse, then all other systems will be affected. Food is indirectly linked to fuel, the value of a currency, trade dependence, smuggling, subsidies, reforms, and other factors. When facing such daily challenges, it is hard to discuss consumer choices when it comes to food. How can a citizen barely able to provide food for themselves and their families be presented with the dire climate effects of their food choices?

What Lebanon needs is a holistic change to its governmental situation that should uplift the country from its current economic and financial situation. That is the proper structural reform that will end the food crisis on a long-term basis. Short-term solutions are also welcomed but should not oversee the needed change.

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