Lebanon's Central Bank deputies: A closer look at their actions and motivations

Recently, the deputies of Lebanon's central bank governor have achieved some of the objectives outlined in their statement issued on July 6. The statement included an implicit threat of resignation.

The first goal they accomplished was opening a public discussion about the period under Governor Riad Salameh since their appointment in 2020. This discussion comes ahead of Salameh's departure from his position in less than two weeks.

This article is originally published in, translated from Lebanese newspaper Nidaa Al-Watan.

The deputies of the central bank governor presented documents and voiced objections to Salameh's decisions and actions, claiming they had previously registered and sent them to the government through the Finance Ministry.

According to monitoring sources, "Youssef Khalil, who is colluding with Salameh and in agreement with Nabih Berri and Najib Mikati, did not respond to the deputies' remarks, which were supposed to reach the government."

On Tuesday, the deputies convened a meeting of the Administration and Justice Committee in the Parliament to address several issues troubling them from the previous phase and those that worry them in the upcoming stage. The discussion covered topics such as monetary and financial policies, support, and the role of the banking platform, as well as the possibility of using the remaining foreign currency reserves in the central bank.

The success of the governor appeared to be seeking "political and legal protection if asked to continue Salameh's policies, especially regarding the use of reserves or compulsory employment to meet the government's demands for remaining support and some public expenses in dollars, or to intervene in the banking platform to stabilize the dollar exchange rate."

Monitoring sources confirm that the governor's deputies have the "Monetary and Credit Law" to protect them, which specifies how to deal with government requests, exchange rates, and other issues they seek to have covered by governmental and parliamentary legislation. These provisions have been applied during the tenures of previous central bank governors, including Michel Khoury, Edmond Naim, Elias Sarkis, and Philippe Takla, despite facing significant challenges.

The sources further explain that the governor's deputies are hesitant and even fearful about the situation, as they may be held accountable after August 1 if they lack political protection.

Parliament Speaker Nabih Berri, who is not inclined to appoint First Deputy Governor Wassim Mansouri as the new governor for sectarian reasons, is among the driving forces behind this discussion, ensuring that the government takes responsibility, and possibly the Parliament as well, to prevent Mansouri from being isolated and to shift blame onto Berri and the Shia sect.

On another note, Finance Minister Youssef Khalil's arguments in favor of not publishing the forensic audit to protect Riad Salameh and the system collapsed yesterday, as the Council of State urged for its immediate release.

Administrative Judge Carl Irani issued a ruling obligating the Finance Ministry to hand over the "legal memorandum" on behalf of the Coalition for Financial Crimes Accountability, along with "the information and documents available to it related to the stages of the forensic audit contract signed on September 17, 2021, with Alvarez & Marsal, and any useful information and details for this purpose without delay."

However, the judge rejected all the arguments presented by the cases department at the Justice Ministry to reject the request, including the excuse of protecting "financial national security," which the judge deemed a new concept not mentioned in the law, and that exceptions to the right of access to information must be narrowly interpreted.

The judge emphasized the state's duty, on its own, to inform citizens about the stages reached in the forensic audit, particularly after all the deadlines specified in the contract have elapsed. The forensic audit is expected to reveal the real and hidden reasons for Lebanon's financial and economic collapse.