The monetary and banking crisis has shattered the longstanding political and economic taboo in Lebanon surrounding the management of the Central Bank’s substantial gold reserve, which is now valued at around $50 billion.

Hesitant statements have escalated into public demands, articulated from the parliamentary podium and advocating to government and common audiences alike.

The demands may soon make popular and economic sense as the rising global prices, would allow for a partial liquidation to finance Lebanon's recovery.

Could Minister of Industry Joe Issa Al-Khoury’s proposal to sell part of the gold to repay deposits soon evolve into a draft law to be presented to parliament, lifting the legal ban on gold management established under Law 46 of 1986?

Will it be allocated for deposits?

Several project proposals are expected to emerge in the media soon, including one from a group of businessmen and bankers seeking to persuade decision-makers to pass a law permitting the sale of the gold in two tranches. The first tranche would immediately use its proceeds to pay each depositor $50,000, while the second, expected the following year amid anticipated further rises in gold prices, would cover the remaining $50,000 of the $100,000 outlined in the financial gap legislation.

Could the debate over the financial gap law provide an opportunity for openly or quietly supportive MPs to incorporate this proposal into the legislation?

Minister Khoury aims to challenge the entrenched public perception that the gold reserve is direct property of the Lebanese state. In reality, the gold is legally and financially classified as an asset of the Central Bank of Lebanon, not part of the public treasury, and is therefore governed by the Central Bank’s balance sheet rules rather than political decisions. This distinction is particularly crucial given the current financial situation, in which the Central Bank registers negative capital, legally preventing it from using its assets solely for the benefit of its sole shareholder—the state.

Yet Khoury proposes a limited gold liquidation as part of a broader discussion linked to the financial gap law project. The law requires the Central Bank to cover roughly 80% of deposits exceeding $100,000—amounting to nearly $40 billion—through long-term bonds backed by returns on its assets. From the Minister’s perspective, this plan does little to address the Central Bank's liquidity shortage, saddling it with obligations stretching over decades and effectively postponing rather than resolving the crisis.

Therefore, Khoury proposes using a limited portion of the gold reserve—no more than $15 billion—for safe investments in bonds issued by countries or high-credit institutions. According to the proposal, this approach would ease pressure on the Central Bank’s balance sheet, curb the accumulation of long-term obligations, and offer a more realistic path to deposit recovery.

However, this proposal runs up against a firm legal and legislative barrier. Economic expert Pierre Khoury notes that the Central Bank’s financial independence does not grant it unrestricted control over the gold. The reserve is safeguarded by a series of laws, most notably the 1986 legislation prohibiting its management—a measure that has preserved it through years of war and economic collapse. This strict legal framework acts as a protective barrier that cannot be overlooked, underscoring that the Central Bank’s ownership of the gold does not give its governor absolute authority to act; any measures require clear and explicit legislative authorization.

Opponents of touching the gold base their stance on a deep-seated mistrust of political authorities, recalling the legacy of the late President Elias Sarkis, who built the reserve as a historic safety net rather than a tool to cover accumulated failures. Proponents of the measure suggest that it is equally protected; splitting government assets over long-term bonds and cautiously benefiting from the current gold price—thereby generating additional liquidity without endangering the asset.

Attorney Akram Azouri settles the ongoing debate over the gold reserve, telling Annahar that the Central Bank of Lebanon "is the actual owner of the gold reserve, and therefore the state cannot act on it without a legislative framework." He emphasized that lawmakers had previously chosen to prohibit gold sales out of concern for safeguarding it, and that decision remains in force today.

Azouri emphasized that "The Central Bank of Lebanon enjoys full independence," adding that "The Code of Money and Credit laid the foundation for Lebanon’s financial prosperity, clearly establishing the separation between the state and the Central Bank: the bank does not lend to the state, nor does the state lend to it." He noted that "Central bank independence is a cornerstone in every country, as no banking system can attract funds or safeguard people’s deposits if the state controls its central bank." According to Azouri, "Trust arises precisely from the absence of such dominance."

This principle is particularly important in the Eurobond context, as the Central Bank’s independence means its assets—including gold—are not state property, and therefore cannot be seized by creditors or subjected to judicial proceedings, especially in New York courts. This legal reality provides a vital safeguard for Lebanon and is a key reason for keeping the gold on the Central Bank’s balance sheet rather than transferring it to state custody.