Lebanon Considers Selling Part of Its Gold Reserves to Tackle Financial Crisis Amid Widespread Public Opposition

The British newspaper Financial Times reported that Lebanese politicians and bankers are studying the possibility of selling or leasing part of the central bank’s substantial gold reserves in an effort to rescue the country from the repercussions of its prolonged economic and financial crisis, amid soaring global gold prices.

Lebanon has been struggling with a severe economic downturn since 2019. However, the idea of selling the country’s gold reserves is described as “unpopular,” with many Lebanese believing such a move would benefit a small elite at the expense of the broader population.

Significant Gold Holdings

Despite its relatively small size, Lebanon holds around 280 tons of gold, making it the second-largest holder of gold reserves in the region after Saudi Arabia. The country began accumulating gold in the 1940s and 1950s to support the value of the Lebanese pound.

Gold prices have surged by approximately 70% over the past year, reaching around $5,000 per ounce. As a result, the value of Lebanon’s gold reserves is estimated at roughly $45 billion in 2026—equivalent to more than half of the financial sector’s accumulated losses.

However, Lebanese law prohibits the sale or leasing of the country’s gold reserves, meaning parliament would need to pass new legislation to authorize such a step.

Banking Crisis and IMF Conditions

One of the root causes of Lebanon’s financial crisis was the central bank’s policy of offering high interest rates on dollar deposits to commercial banks, which in turn offered elevated returns to depositors in order to maintain foreign currency inflows.

Depositor liabilities at Lebanese banks eventually reached about $70 billion—an amount the banking sector has been unable to repay—while the state lacks the fiscal capacity to intervene.

Lebanon is seeking to pass a bank deposit recovery law as a prerequisite for reaching an agreement with the International Monetary Fund, which would unlock much-needed loans and credit facilities tied to structural reforms. Since the crisis erupted in 2019, Lebanon has failed to meet the IMF’s required conditions.

Although the current draft law excludes the use of gold reserves, some analysts argue that gold could ultimately become part of the solution, given the central bank’s limited liquidity and the scale of its obligations. The IMF is reportedly not opposed in principle to such a move.

Critics have called for transparency, warning that if gold is to be used to implement the new law, policymakers should state so clearly rather than passing legislation that cannot be executed without tapping the reserves.

Supporters of selling part of the gold reserves have refrained from publicly advocating the idea, fearing further public backlash.

In summary, Lebanon’s gold reserves—accumulated decades ago to safeguard monetary stability—are now at the center of a highly sensitive debate, balancing urgent financial needs against public trust and national sovereignty.