Lebanon’s government appointed asset manager Karim Souaid as central bank governor on Thursday, tasking him with steering the country’s financial system out of a prolonged economic crisis. The move comes as Lebanon seeks reforms to unlock international aid while grappling with the effects of years of financial mismanagement and the recent war between Hezbollah and Israel.
Prime Minister Nawaf Salam announced Souaid’s selection after a cabinet vote, in which 17 out of 24 ministers backed him. Salam himself abstained, citing concerns about depositors’ rights.
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A former HSBC executive, Souaid is seen by critics as aligned with Lebanon’s commercial banks, which have resisted reforms that would force them to absorb the country’s financial losses. Since Lebanon’s financial meltdown in 2019, the banking sector has imposed informal capital controls, restricting access to dollar deposits. The crisis, compounded by the Beirut port explosion in 2020 and the COVID-19 pandemic, has driven nearly half the population into poverty.
Souaid replaces Riad Salameh, who led the central bank for three decades before stepping down in 2023 under multiple international corruption allegations. His departure left a leadership vacuum.
The new governor will face mounting pressure to negotiate a deal with the International Monetary Fund, which has urged Lebanon to combat corruption and restructure its banking system if it wants to be bailed out.
In a press briefing on Thursday, IMF spokesperson Julie Kozack said that Lebanon needs “a comprehensive strategy for economic rehabilitation” with a focus on transparency.