Beirut: The National Initiative for Monetary Stability met with the Lebanese Economic Bodies at the Beirut and Mount Lebanon Chamber of Commerce, Industry and Agriculture to discuss a proposal to establish a Currency Board in Lebanon as the country weighs options to secure lasting monetary and financial stability.
According to National news agency - Lebanon, the meeting focused on how a Currency Board could operate in Lebanon, whether the model is suited to the country's current economic conditions, and what role it could play alongside broader banking, fiscal, and structural reforms.
Ray Dabbane, founder of the National Initiative for Monetary Stability and Founder and CEO of Invus, presented the proposal, arguing that Lebanon needs to move away from discretionary monetary policy toward a rules-based framework that can provide greater predictability and discipline.
Dabbane stated that a Currency Board would function under binding monetary rules, with the relevant monetary base fully backed by liquid foreign reserves and the currency convertible at a fixed exchange rate. Under such a system, monetary issuance could not be used to finance government deficits or bail out banks.
"Lebanon needs to move from managing monetary stability through discretionary policies to a system governed by clear and binding rules," Dabbane stated.
"A Currency Board can provide a framework for enforcing monetary discipline and shielding monetary stability from political pressures, strengthening the credibility of the Lebanese pound and providing a more solid foundation for economic recovery," he added.
Dabbane stressed that the proposal should not be viewed as a substitute for the wider reforms needed to address Lebanon's economic and financial crisis.
"A Currency Board is not a substitute for the banking, fiscal and structural reforms Lebanon requires," he said. "It provides a stable monetary environment in which those challenges can be addressed."
Nicolas Chamas, Secretary-General of the Lebanese Economic Bodies, delivered remarks on behalf of the group's president, former minister Mohamed Choucair, welcoming the discussion and expressing hope that the proposal could contribute to Lebanon's recovery and the pursuit of sustainable financial and monetary stability.
"The establishment of a Currency Board could provide an additional layer of resilience for the Lebanese economy," Chamas said.
He called for "a serious and responsible discussion of the available options," saying Lebanon can no longer afford to remain on its current course and that the scale of the crisis requires new approaches.
Chamas stated that the Lebanese Economic Bodies were prepared to work with the relevant authorities to examine the proposal, its implications, and the conditions required for its implementation.
The goal, he said, is to assess the proposal in a way that "serves Lebanon's interests, reinforces financial and monetary stability, and places the economy on a path toward sustainable recovery."