As the Lebanese Cabinet under Nawaf Salam prepares to appoint a new governor for the Banque du Liban (BDL), assessments on Wassim Mansouri's interim tenure since August 2023 are mixed. Some view his actions as having preserved a degree of stability amidst unprecedented political and security crises, while others argue that the stability he has maintained is tenuous, weighed down by ongoing inflation and the devaluation of the Lebanese pound. In a recent interview with Independent Arabia on Tuesday, Mansouri shared his insights on his tenure as acting governor of Lebanon's central bank.
Discussing his approach to managing the exchange rate and ensuring monetary stability, Mansouri emphasized that his goal was not to artificially stabilize the exchange rate, but to safeguard the BDL’s foreign currency reserves. One of the most significant decisions during his leadership was the complete cessation of direct state financing, which he called "irreversible." This shift allowed the state to rely on its own revenue for spending, thereby reducing the deficit. Mansouri pointed out that in 2023, the state’s revenue doubled compared to previous years, and recorded a budget surplus of $600 million in 2024. He also noted that the BDL now manages state funds rather than being a creditor.
On the subject of imports, Mansouri implemented a new mechanism to finance imports without tapping into foreign currency reserves. Additionally, since August 2023, he halted dollar purchases from the market, choosing instead to focus on managing the Lebanese pound’s money supply. He argued that this policy contributed to strengthening the BDL's reserves, which have accumulated a surplus exceeding $2 billion.
Regarding monetary policy, Mansouri explained that he refrained from using traditional tools like raising interest rates due to the dollarization of Lebanon’s economy. Instead, he focused on regulating the money supply in Lebanese pounds and managing salaries by paying government employees in dollars to minimize pressure on the exchange rate.
He also ended the Sayrafa platform, which had been used to manage the exchange rate. Mansouri believed that the platform had created undue pressure on the currency market, and he maintained that his decision successfully preserved market stability while also boosting foreign currency reserves. He highlighted that inflation had decreased significantly, from 300% in April 2023 to 18% in December 2024, with projections for inflation to drop further to 3-5% in 2025.
Regarding bank deposits, Mansouri emphasized that the central bank was dedicated to finding a fair solution for depositors, stressing the importance of an equitable approach aligned with the Lebanese constitution. He also addressed the issue of Syrian deposits, clarifying that they would be treated in the same manner as Lebanese deposits in accordance with Lebanese property rights law.
Regarding the banking sector, he clarified that the BDL does not financially support banks but encourages competition and sector restructuring.
Mansouri also touched upon efforts to remove Lebanon from the FATF’s gray list of countries at risk of money laundering. He explained that a detailed plan had been implemented to comply with international standards and enhance transparency.
Mansouri concluded by reaffirming that his main priority remains the country’s monetary and financial stability, expressing his readiness to collaborate with his successor to ensure the continuity of the reforms he has initiated.
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