Banks accept lollars for
15 percent of medical imports

The Association of Banks (ABL) has urged the banks not to ask importers of medicine and medical supplies to pay 15 percent of the value of their import documentary credit in cash, according to an ABL circular.

Importers of medicine and medical supplies have to provide this amount in foreign currencies. They can secure the remaining 85 percent from the Central Bank (BDL) at the exchange rate of LL1,515.

ABL said the new decision was reached in agreement with BDL. It exhorted the banks to debit the 15 percent amount to the account of importers or accept a transfer from another bank or a check deposit of the amount.

Salma Assi, Chairperson of the Syndicate of Importers and Traders of Medical and Laboratory Equipment, said the banks are likely to abide by ABL’s recommendation.

She said that allowing payments by check, or bank transfer, or by debiting a bank account, means that the 15 percent could be paid in ‘lollars’ (dollars stuck in bank accounts). The lollar is currently at LL3,900 while the dollar is trading on the black market at around LL8,000.Importers had to buy the dollars for the 15 percent portion of the import bill on the black market.

Assi said that while this problem has been solved, they still have to provide the 85 percent part of the import bill in cash in lira while hospitals cannot easily pay importers of medical supplies in cash. She said that BDL had previously frozen LL52 billion provided by importers of medical supplies to pay for their imports that they cannot use now and so they have to secure additional cash to pay for new shipments.

BDL decided earlier this month that importers of basic commodities must settle in cash in lira the 85 percent portion of the import bill. The measure aims to curb the surge in lira money supply which worsens the rampant inflation and contributes to the further decline of the exchange value of the national currency.