Omar al-Rassi, “Akhbar al-Yawm” agency
A financial source warns via "Akhbar al-Yawm": Informations will be outside Lebanon
"The economic system in Lebanon has relied for many years on the banking sector only, as a result of the absence of the capital sector and trading through the stock exchange, so there was a major collapse in the banking sector, knowing that in all countries of the world the economy runs on two wheels, the banking sector and the capital sector", according to a senior financial source, who stressed via the "Akhbar al-Yawm" agency on the need to revive the Beirut Stock Exchange, which opens the way for the exit and entry of money through it being a trading arena for stocks and currencies, which encourages many companies to list their shares in it.
The position of the financial source came in a comment on the Banque du Liban's quest to dollar trading through a free market, where the trend is towards international platforms or companies such as "Reuters" and "Bloomberg"...
He asked: the Beirut Stock Exchange exists, so why the trend towards the outside?
The source explained that the trading system adopted at the Beirut Stock Exchange is EURONEXT (global European) and is owned by the Lebanese state, meaning that it bought it and paid for it, and can conduct more than a thousand transactions per minute. While we do not know the cost of the trend towards foreign companies, he added: It is true that these institutions have great credibility and confidentiality in trading, but eventually the information became outside Lebanon, at a time when it is supposed to remain within the local scope monitored by the Capital Markets Authority and the Bank of Lebanon.
The source explained that the stock exchange is like the market where the auction is held, where the buy and sell orders meet, and therefore the trading system combines all those orders and determines how it can be reconciled among them according to the nearest price at which the operations take place, saying: the market is the Beirut Stock Exchange, while the banks are the entities that own the funds offered for sale and purchase.
Pointing out that the names of the parties wishing to sell or buy do not appear in order to preserve the confidentiality of the deliberations, the source said: the funds offered by the banks are placed in the Bank of Lebanon in order for the settlement process to take place, and then under the sale and purchase, the transfer is made from Bank A to Bank B... He considered that the Banque du Liban seeks to do this path through Bloomberg, Reuters or any similar companies.
In response to a question, the source said: despite its importance, the Beirut Stock Exchange is almost forgotten and the companies in which its shares are listed are few, most notably Solidere and some banks... He pointed out that the revival of the stock exchange is re-trading through it, and this is what prompts several companies to list their shares in it, and thus the matter leads to strengthening the capital sector in Lebanon.
In the end, the source asked: Will we rebuild the economy on the same bases that was previously dominant and led to its collapse?
He concluded: handing over the country to the same parties and people will never get us out of crises...