| Date - Field | Lebanon - Economy - overview |
2008 January
Economy - overview | The 1975-90 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. In the years since, Lebanon has rebuilt much of its war-torn physical and financial infrastructure by borrowing heavily - mostly from domestic banks. In an attempt to reduce the ballooning national debt, the Rafiq HARIRI government began an austerity program, reining in government expenditures, increasing revenue collection, and privatizing state enterprises, but economic and financial reform initiatives stalled and public debt continued to grow despite receipt of more than $2 billion in bilateral assistance at the Paris II Donors Conference. The Israeli-Hizballah conflict in July-August 2006 caused an estimated $3.6 billion in infrastructure damage, and prompted international donors to pledge nearly $1 billion in recovery and reconstruction assistance. Donors met again in January 2007 and pledged over $7.5 billion to Lebanon for development projects and budget support, conditioned on progress on Beirut's fiscal reform and privatization program. Internal Lebanese political tension continues to hamper economic activity, particularly in the tourism and retail sectors. |
2007 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. In the years since, Lebanon has rebuilt much of its war-torn physical and financial infrastructure by borrowing heavily - mostly from domestic banks. In an attempt to reduce the ballooning national debt, the Rafiq HARIRI government began an austerity program, reining in government expenditures, increasing revenue collection, and privatizing state enterprises, but economic and financial reform initiatives stalled and public debt continued to grow despite receipt of more than $2 billion in bilateral assistance at the Paris II Donors Conference. The Israeli-Hizballah conflict caused an estimated $3.6 billion in infrastructure damage in July and August 2006, and internal Lebanese political tension continues to hamper economic activity. |
2006 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. In the years since, Lebanon has rebuilt much of its war-torn physical and financial infrastructure by borrowing heavily - mostly from domestic banks. In an attempt to reduce the ballooning national debt, the HARIRI government began an austerity program, reining in government expenditures, increasing revenue collection, and privatizing state enterprises. In November 2002, the government met with international donors at the Paris II conference to seek bilateral assistance in restructuring its massive domestic debt at lower rates of interest. Substantial receipts from donor nations stabilized government finances in 2003, but did little to reduce the debt, which stood at nearly 180% of GDP. In 2004 the HARIRI government issued Eurobonds in an effort to manage maturing debt, and the KARAMI government has continued this practice. However, privatization of state-owned enterprises had not occurred by the end of 2004, as promised during the Paris II conference. |
2005 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. In the years since, Lebanon has rebuilt much of its war-torn physical and financial infrastructure by borrowing heavily - mostly from domestic banks. In an attempt to reduce the ballooning national debt, the HARIRI government began an austerity program, reining in government expenditures, increasing revenue collection, and privatizing state enterprises. In November 2002, the government met with international donors at the Paris II conference to seek bilateral assistance in restructuring its massive domestic debt at lower rates of interest. Substantial receipts from donor nations stabilized government finances in 2003, but did little to reduce the debt, which stood at nearly 180% of GDP. In 2004 the HARIRI government issued Eurobonds in an effort to manage maturing debt, and the KARAMI government has continued this practice. However, privatization of state-owned enterprises had not occurred by the end of 2004, as promised during the Paris II conference. |
2004 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. Peace enabled the central government to restore control in Beirut, begin collecting taxes, and regain access to key port and government facilities. Economic recovery was helped by a financially sound banking system and resilient small- and medium-scale manufacturers. Family remittances, banking services, manufactured and farm exports, and international aid provided the main sources of foreign exchange. Lebanon's economy made impressive gains since the launch in 1993 of "Horizon 2000," the government's $20 billion reconstruction program. Real GDP grew 8% in 1994, 7% in 1995, 4% in 1996 and in 1997, but slowed to 1.2% in 1998, -1.6% in 1999, -0.6% in 2000, 0.8% in 2001, 1.5% in 2002, and 3% in 2003. During the 1990s, annual inflation fell to almost 0% from more than 100%. Lebanon has rebuilt much of its war-torn physical and financial infrastructure. The government nonetheless faces serious challenges in the economic arena. It has funded reconstruction by borrowing heavily - mostly from domestic banks. In order to reduce the ballooning national debt, the re-installed HARIRI government began an economic austerity program to rein in government expenditures, increase revenue collection, and privatize state enterprises. The HARIRI government met with international donors at the Paris II conference in November 2002 to seek bilateral assistance restructuring its domestic debt at lower rates of interest. While privatization of state-owned enterprises had not occurred by the end of 2003, massive receipts from donor nations stabilized government finances throughout 2002 and 2003. |
2003 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. Peace enabled the central government to restore control in Beirut, begin collecting taxes, and regain access to key port and government facilities. Economic recovery was helped by a financially sound banking system and resilient small- and medium-scale manufacturers. Family remittances, banking services, manufactured and farm exports, and international aid provided the main sources of foreign exchange. Lebanon's economy made impressive gains since the launch in 1993 of "Horizon 2000," the government's $20 billion reconstruction program. Real GDP grew 8% in 1994, 7% in 1995, 4% in 1996 and in 1997, but slowed to 1.2% in 1998, -1.6% in 1999, -0.6% in 2000, 0.8% in 2001, and 1.5% in 2002. During the 1990s annual inflation fell to almost 0% from more than 100%. Lebanon has rebuilt much of its war-torn physical and financial infrastructure. The government nonetheless faces serious challenges in the economic arena. It has funded reconstruction by borrowing heavily - mostly from domestic banks. In order to reduce the ballooning national debt, the re-installed HARIRI government began an economic austerity program to rein in government expenditures, increase revenue collection, and privatize state enterprises. The HARIRI government met with international donors at the Paris II conference in November 2002 to seek bilateral assistance restructuring its domestic debt at lower rates of interest. While privatization of state-owned enterprises had not occurred by the end of 2002, the government had successfully avoided a currency devaluation and debt default in 2002. |
2002 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. Peace enabled the central government to restore control in Beirut, begin collecting taxes, and regain access to key port and government facilities. Economic recovery was helped by a financially sound banking system and resilient small- and medium-scale manufacturers. Family remittances, banking services, manufactured and farm exports, and international aid provided the main sources of foreign exchange. Lebanon's economy made impressive gains since the launch in 1993 of "Horizon 2000," the government's $20 billion reconstruction program. Real GDP grew 8% in 1994, 7% in 1995, 4% in 1996 and in 1997 but slowed to 2% in 1998, -1% in 1999, and -0.5% in 2000. Growth recovered slightly in 2001 to 1%. During the 1990s annual inflation fell to almost 0% from more than 100%. Lebanon has rebuilt much of its war-torn physical and financial infrastructure. The government nonetheless faces serious challenges in the economic arena. It has funded reconstruction by borrowing heavily - mostly from domestic banks. The re-installed HARIRI government has failed to rein in the ballooning national debt. Without large-scale international aid and rapid privatization of state-owned enterprises, markets may force a currency devaluation and debt default in 2002. |
2001 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. Peace enabled the central government to restore control in Beirut, begin collecting taxes, and regain access to key port and government facilities. Economic recovery was helped by a financially sound banking system and resilient small- and medium-scale manufacturers. Family remittances, banking services, manufactured and farm exports, and international aid provided the main sources of foreign exchange. Lebanon's economy has made impressive gains since the launch in 1993 of "Horizon 2000," the government's $20 billion reconstruction program. Real GDP grew 8% in 1994, 7% in 1995, 4% per year in 1996 and 1997 but slowed to 2% in 1998, -1% in 1999, and 1% in 2000. Annual inflation fell during the course of the 1990s from more than 100% to 0%, and foreign exchange reserves jumped from $1.4 billion to more than $6 billion. Burgeoning capital inflows have generated foreign payments surpluses, and the Lebanese pound has remained very stable for the past two years. Lebanon has rebuilt much of its war-torn physical and financial infrastructure. Solidere, a $2-billion firm, has managed the reconstruction of Beirut's central business district; the stock market reopened in January 1996; and international banks and insurance companies are returning. The government nonetheless faces serious challenges in the economic arena. It has funded reconstruction by tapping foreign exchange reserves and by borrowing heavily - mostly from domestic banks. The newly re-installed HARIRI government's announced policies fail to address the ever-increasing budgetary deficits and national debt burden. The gap between rich and poor has widened in the 1990s, resulting in grassroots dissatisfaction over the skewed distribution of the reconstruction's benefits. |
2000 January
Economy - overview | The 1975-91 civil war seriously damaged Lebanon's economic infrastructure, cut national output by half, and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. Peace has enabled the central government to restore control in Beirut, begin collecting taxes, and regain access to key port and government facilities. Economic recovery has been helped by a financially sound banking system and resilient small- and medium-scale manufacturers, with family remittances, banking services, manufactured and farm exports, and international aid as the main sources of foreign exchange. Lebanon's economy has made impressive gains since the launch of "Horizon 2000," the government's $20 billion reconstruction program in 1993. Real GDP grew 8% in 1994 and 7% in 1995 before Israel's Operation Grapes of Wrath in April 1996 stunted economic activity. Real GDP grew at an average annual rate of less than 3% per year for 1997 and 1998 and only 1% in 1999. During 1992-98, annual inflation fell from more than 100% to 5%, and foreign exchange reserves jumped to more than $6 billion from $1.4 billion. Burgeoning capital inflows have generated foreign payments surpluses, and the Lebanese pound has remained relatively stable. Progress also has been made in rebuilding Lebanon's war-torn physical and financial infrastructure. Solidere, a $2-billion firm, is managing the reconstruction of Beirut's central business district; the stock market reopened in January 1996; and international banks and insurance companies are returning. The government nonetheless faces serious challenges in the economic arena. It has had to fund reconstruction by tapping foreign exchange reserves and boosting borrowing. Reducing the government budget deficit is a major goal of the LAHUD government. The stalled peace process and ongoing violence in southern Lebanon could lead to wider hostilities that would disrupt vital capital inflows. Furthermore, the gap between rich and poor has widened in the 1990's, resulting in grassroots dissatisfaction over the skewed distribution of the reconstruction's benefits and leading the government to shift its focus from rebuilding infrastructure to improving living conditions. |
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This page was last updated on 23 July, 2008 |
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