LONDON: In common with millions of other Lebanese living abroad, London restaurateur Moufid Shamms is unable to send cash back to support his family - in his case daughters studying at school. Banks back home have remained shut for five working days as hundreds of thousands have taken to the streets to protest against Prime Minister Saad Hariri’s government.
That is a problem for Shamms, who usually makes transfers via Western Union, and also for Lebanon’s small economy. Remittances are a lifeline for families and important source of financing for the economy, funding almost half the trade deficit.
“I have my two eldest daughters living in Lebanon and now I can’t send them money,” the 49-year-old says, sitting outside his restaurant in Edgware Road, a bustling Arab heartland in the British capital.
Lebanese nationals overseas have an outsize influence on their native country’s fortunes.
After many fled from Civil War between 1975-1990, estimates now put Lebanon’s diaspora as high as 14 million - more than twice the size of its domestic population. Britain is among the top 10 countries of origin for remittances to Lebanon. A 2011 census recorded more than 15,000 Lebanese living in Britain.
Having left in 1989, sick of the violence and corruption back then, 49-year-old Shamms sees ongoing graft as a prominent issue in the latest upheaval.
“The corruption in Lebanon is why I left,” he says, puffing on a nargileh. “Everyone has a right to protest and all Lebanese agree with what they’re asking but we all know nothing is going to be changed because you know Lebanon.”
Globally, flows to Lebanon have faltered recently.
One reason for that is concern from some expatriates about the risk of a looming economic collapse back home, economists say.
Another is the Gulf, where hundreds of thousands of Lebanese work, but softening oil prices have hurt the job market.
Having peaked at $9.6 billion in 2014, remittances from the diaspora fell to $7.7 billion in 2018 and may dip to $6.5 billion next year, the Institute of International Finance’s Garbis Iradian estimates.
S&P Global warned last month that waning inflows from nonresidents were contributing to an accelerated drawdown of foreign currency reserves that would test Lebanon’s ability to maintain its currency peg to the U.S. dollar.
While the closure of banks has provided a practical barrier to sending money, some expatriates also voiced worry about the impact a potential devaluation of the Lebanese currency and further financial instability could have on their savings and investments.
“The first income in Lebanon is from people outside. If they stop sending money then that’s the end of the country,” says Ali Sahir, 50, who sends money to support his wife in Lebanon’s south.
London-based public relations professional Roni Sinno has family in Canada, Germany, United Arab Emirates, Qatar and Belgium - all sending money back to relatives.
“There is no work in Lebanon,” she says. “My nieces and nephews finished universities and couldn’t work. One stayed in Lebanon five years unemployed until he found work in Qatar. Meanwhile, the children of the politicians are living luxury lives in London and Paris.”
One driver of the demonstrations has been the large sums of money, they say, siphoned out of Lebanon’s economy through corruption.
“Lots of money has been stolen from the government for the last 30 years,” says Ali Abbas, 35, who moved to London in 2007 after graduating and now works in a shop. “The main thing that will help the country will be bringing this money back to the country.”