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Lebanon ATMs running dry as country faces liquidity crisis

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November 27, 2019

Despite a recent promise by the head of Lebanon's banker's syndicate that ATMs would be stocked with cash, citizens are complaining that cash machines are spitting back bank cards, according to a report in the Washington Post. 

Dollars, which are used alongside the Lebanese pound, have grown scarce in the country, which has been rocked by anti-government protests since mid-October. Most merchants in the country accept dollars and even the ATMs dispense dollars — when they are stocked. 

The liquidity crisis has caused the local currency to plummet in value. Landlords are refusing to accept pounds and even restaurants are asking for dollars, so they can pay vendors, and service people are losing their jobs, according to the Post report. 

After another weeklong strike called by the union representing bank's staff over security concerns for employees, banks reopened on Nov. 18, but consumers are still having trouble accessing cash. 

Initially, in early November, the Association of Banks in Lebanon set a $1,000 ceiling for withdrawals for dollar bank accounts and limited transfers abroad. But now, according to a report in Reuters, banks are steadily tightening those dollar withdrawal limits. 

"Blom Bank, one of Lebanon's largest, has gradually lowered its weekly withdrawal ceiling from $2,500 to $500 this week for depositors with less than $100,000 in their accounts. At Bank Audi, the limit is $300," Reuters said Tuesday. 

Live from my bank in #Lebanon. As I'm leaving to 🇪🇺 soon, I asked for a modest amount from my € account and they said NO. Because all what you have the right to is $500 and as you withdrew them already it counts with the € as well. I printed my ticket to prove it. Still no!

— Dr. Dalia Ghanem (@DaliaZinaGhanem) November 27, 2019

In the last month, about $3.8 billion has been withdrawn from Lebanon's banks, reflecting an increasing lack in confidence in the country's banks, according to the Post.

With a 152% debt to GDP ratio, Lebanon is the third most indebted country in the world. The country's post-war reconstruction was a leading precursor to today's financial problems, which has stoked fears about the country's economic future.