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Lebanon inflation to rise to 7 percent |
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Written by AFP
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Salameh: "It was caused by a general rise caused by the blockade and the dangers of moving from one place to another"
Nov. 15, 2006- Inflation in Lebanon is forecast to rise sharply to seven percent by the end of 2006 due to Israel's devastating summer offensive, the central bank governor has said.
"Studies show that the rise of inflation to seven percent is due to the war," Riad Salameh said in an interview with As-Safir newspaper Wednesday.
"It was caused by a general rise (in consumer prices) caused by the (Israeli) blockade and the dangers of moving from one place to another" during the July-August war, he said.
"We cannot consider that there are structural changes in (consumer) prices in Lebanon because of the rise that occurred during the war," said the central bank governor.
"The monetary policy that succeeded in past years to stabilise prices is still effective."
Leading economist Kamal Hamdan told AFP: "The forecast figure is accurate and it is a worrying figure, when we bear in mind that inflation was at less than 0.5 percent in 2005 and at less than two percent in 2004."
The Israeli military onslaught on Lebanon and an eight-week blockade this summer has increased Lebanon's public debt to 41 billion dollars, according to official figures.
Immediate material damage to infrastructure alone totalled some 3.5 billion dollars, according to official figures.
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