Hariri slaying hurt Lebanon’s economy

By United Press International , May 23, 2005

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The assassination of former Lebanese Prime Minister Rafik Hariri in February had a negative impacton the national economy and banking system, a report says.

The report by the private Audi Bank said Monday most sectors of the economy had suffered from stagnation since Hariri’s Feb. 14 slaying in a massive blast in Beirut.

It said many depositors in Lebanese banks had transferred their savings from Lebanese pounds to U.S. dollars, with total transfers estimated at $5.6 billion, increasing the volume of deposits in dollars to 79.2 percent of total deposits.

Also an estimated $2.3 billion was transferred to banks outside Lebanon, while incoming capital dropped dramatically.

The Central Bank’s foreign currency reserves dropped by $1.4 billion to an estimated $7.6 billion, the report indicated.