Economic Trends/Outlook in Lebanon
Lebanon has a free-market economy with a strong laissez-faire (hands-off) commercial tradition. Following a drawn out civil war (1975-1990), Lebanon started to rebuild the country’s physical and social infrastructures by a massive reconstruction program in 1992. The government is continuing these structural reforms. The GDP growth rate in 2006 was 0%, due to the Israeli invasion and aerial attacks. Since this time, the country’s GDP increased by almost 23% and in 2010 by 7% according to the IMF.
The particularity of the Lebanese economy is that it finds itself opposed to the current global economic cycles, since it is in full growth and has surplus liquidity. However, this economic situation is highly contextual: Lebanon is catching up on the delay caused by both its civil war and the 2006 war. This rate cannot only be explained by the work of private agents.
Because the state is little present in the strategic market behavior, Lebanon offers very few basic utilities (water, electricity) and their cost borne directly by the final consumer, which strongly impedes potential growth.
The government’s key challenge will be reducing the national debt, which represents 150% of the GDP. Unemployment is officially at 18%, yet, in the absence of reliable statistics, it could in reality reach 20-25%. IMF estimates 2010 inflation at 5%.
The country is able to preserve its momentum in the coming years, if indeed the political situation does not worsen (regional tensions and results of the Special Tribunal for Lebanon following the assassination of Rafik Hariri)
|GDP (billions USD)||34.92e||39.25e||42.54e||45.93e||48.74e|
|GDP (Constant Prices, Annual % Change)||8.5e||7.5e||2.5e||5.0e||4.0e|
|GDP per Capita (USD)||9,054e||10,044e||10,747e||11,456e||11,998e|
|General Government Gross Debt (in % of GDP)||146.4||136.7e||133.8e||134.2e||136.6e|
|Inflation Rate (%)||1.2||4.5e||6.5e||3.0e||2.2e|
|Current Account (billions USD)||-3.72e||-4.74e||-5.14e||-5.57e||-|
|Current Account (in % of GDP)||-11.1e||-12.8e||-12.8e||-13.0e||-|
Source: IMF - World Economic Outlook Database
Note: (e) Estimated Data
Main Sectors of Industry
The country’s sustained growth can be explained by the vigor of the key sectors of its economy. The banking sector saw record profits, profits of the three largest banks growing by 19% on 2009. The sustained and lucrative banking activity does not however constitute a real support to the private sector because the majority of liquidity coming from banks is used to finance the national debt.
Lebanon also has a booming real estate sector, which benefits from the burst of the real estate bubble in Dubai. Demand coming from the Arab countries is indeed very high and in the first half of 2010 the average price for m2 in the center of Bayreuth reached 7,000 UDS, equal to an annual growth of 41%.
Lebanon has fertile lands, however the agricultural sector is under-developed and only contributes up to 5% of the GDP.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||-||-||-|
|Value Added (in % of GDP)||5.3||16.5||78.2|
|Value Added (Annual % Change)||3.5||3.0||8.7|
Source: World Bank - Last Available Data.
Indicator of Economic Freedom
- Moderately free
- World Rank:
- Regional Rank:
Sources of General Economic Information
Ministry of Economy and Trade
Ministry of Finance
- Statistical Office
Central Administration for Statistics
- Central Bank
Central Bank of Liban
- Stock Exchange
Beirut Stock Exchange
- Other Useful Resources
Zawya, economic website about the Middle East.
Ame info, economic information website about the Middle East.
- Main Online Newspapers
La Revue du Liban (in French)
Al Watan Al Arabi (in Arabic)
Annabaa (in Arabic)
Al Anwar (in Arabic)
Al Balad (in Arabic)
Al-Aman (in Arabic)
Al-Mustaqbal (in Arabic)
Aliwaa (in Arabic)
El Shark (in Arabic)
L'Orient Le Jour (in French)
The Daily Star - Lebanon
As-Safir (in Arabic)
Al-Markazia (in Arabic)
Almassira (in Arabic)
Al-Akhbar (in Arabic)
An-Nahar (in Arabic)
Dar Al Hayat (in Arabic)
Al Intiqad (in Arabic)
- Economic Portals
An Nahar: the country'smost important paper
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