Bread may no longer be on Lebanese tables in 20 days

Bakeries in Lebanon could stop working in 20 days due to an acute shortage of flour in the mills emanating from the country's inability to pay dues for importing wheat amid a socioeconomic crisis since 2019.

The Federation of Bakeries and Ovens Syndicates alerted on Thursday that bread may no longer be available, as flour is projected to run out if the ruling troika does not take urgent action, in a country where about 80 percent of the population lives under the poverty line.

“A large number of mills are still suspended due to a delay in the Central Bank of Lebanon’s payment of the price of imported wheat to the mills, causing a shortage of flour for the bread industry, despite the Cabinet’s decision in its last session of setting $12.5 million to pay the price of four ships of wheat, but this decision has not been implemented yet,” the statement read.

The wheat importers are unable to purchase wheat due to a delay in paying for the price of wheat ships, the Federation said, calling on the ruling troika to provide funds necessary to import quantities sufficient for several months.

A week ago, owners of bakeries protested outside the Ministry of Economy, demanding that wheat should be secured for the mills, along with setting a price for the bundle of bread in proportion to the exchange rate, said the state-owned National News Agency (NNA).

Three days earlier, the Minister of Economy and Trade in the caretaker government, Amin Salam, said that the Central Bank of Lebanon is unable to fully support the country’s need for wheat due to the economic situation and the rise in wheat prices globally as a result of the ongoing Russian-Ukraine conflict. However, he added that the crisis could be eased if mills started producing flour from the unsubsidized wheat, which can be imported by traders and owners of bakeries.

In a response to the global grain crisis caused by the conflict between Ukraine and Russian, the largest wheat exporting countries in the world, the World Bank approved on May 9 a $150 million loan for importing wheat at a stable price over nine months to be affordable for the poor. 

“In Lebanon, the World Bank supports the recently approved Wheat Supply Emergency Response Project (IBRD $135 million and Global Concessional Financing Facility (GCFF) $15 million) which aims to ensure the availability of wheat in Lebanon, in response to the global commodity market disruptions, and to maintain access to affordable bread by poor and vulnerable households,” said the International Monetary Fund (IMF) in a statement on May 18.

However, the bread crisis in Lebanon started before the outbreak of the war on Ukraine, as the country has suffered from a financial liquidity crisis, which was deepened by the Ukraine crisis and its global repercussions, Lebanese political expert Ahmed El Ghoz told Jusoor Post on Friday, adding that the crisis is linked with many factors like the absence of the foreign reserve at the Central Bank and the lack of remittances amid the need for the dollar to meet basic needs.

Ghoz noted that Ukraine has said it would provide Lebanon with wheat, but the country has no money, adding that bakery owners with dollars could buy the wheat needed for flour. “If the traders have dollars, why would they head to the Central Bank where there is no money?” he wandered.

The current flour situation is not new, as the Federation announced in April that some bakeries stopped working because mills did not receive wheat due to delays in paying the owners of wheat ships, Annahar newspaper reported. Since the 2022 explosion of Beirut port, in which more than 200 people were killed and 7,000 others injured, Lebanon has lacked main silos to store wheat.

In case the bakeries stop producing bread, the situation could lead to a civil war and uprising by the people, said economic expert Sherif El Demerdash in comments to Jusoor Post on Friday. “It could lead to a revolution of hunger. It will be a bread revolution,” he said.

“The situation is very dangerous. If the world and the international stakeholders in Lebanon do not take any initiative to import wheat, the revolution could break out,” Demerdash said, noting that a collapse of Lebanon would have dire consequences on neighboring countries and jeopardize the interests of Saudi Arabia and Iran in Lebanon as well. 

The situation in Lebanon is getting worse, as the real GDP is projected to drop by 6.5 percent in 2022, the World Bank said on May 30.

“Despite early warnings, Lebanon has lost precious time and numerous opportunities to adopt a path to reform its economic and financial system. The cost of inaction is colossal not only on daily lives of citizens, but also on the future of the Lebanese people,” said Saroj Kumar Jha, World Bank Mashreq Regional Director.