Israeli Attacks Worsen Lebanon’s Already Struggling Economy

Lebanon is grappling with severe economic and living conditions due to ongoing Israeli attacks since October, which have recently escalated, pushing the country deeper into its worst economic crisis since 2019. The negative repercussions on the Lebanese economy are increasing due to the large wave of displacement of hundreds of thousands of Lebanese citizens from border areas and villages targeted by Israeli entity's airstrikes, which have led to the death and injury of thousands of residents. This wave of displacement has disrupted the economy in many Lebanese regions and governorates, with expectations of a rise in the number of displaced people in the near future. An economic expert and member of the Economic and Social Council in Lebanon, Dr. Anis Abu Diab told the Qatar News Agency that the Lebanese economy has been in an unprecedented crisis since 2019. The country has faced a series of calamities, such as mass protests, the COVID-19 pandemic, Beirut port explosion and the deposit crisis, which cause d an estimated loss of around USD 80 billion, largely burdening depositors. Dr. Abu Diab added that just as Lebanon began to regain some economic stability in 2022, particularly in the private sector, with positive forecasts for the summer of 2023 promising a rebound in the tourism sector, the escalation of violence in Gaza on Oct. 7, followed by the attacks on Lebanon the next day, dealt a harsh blow to the Lebanese economy. The tourism sector, a crucial pillar of the country's economy, has seen a sharp decline since then, he said. Currently, Lebanon finds itself in a state of war, partially crippling its economy, he said, pointing out that the southern provinces are economically paralyzed, with expectations of up to one million displaced people moving from the south, Bekaa, and Dahiya to various Lebanese regions. The member of the Economic and Social Council in Lebanon pointed out that the Israeli attacks' repercussions on the Ministry of Health and the Relief and Humanitarian Aid Organization are estima ted at millions of dollars. He added that Lebanon was expected to achieve a growth rate of around 1.2 percent of GDP in 2024, but this figure has now dropped to 0.2 percent. Dr. Anis Abu Diab told QNA that the direct financial losses due to the Israeli aggression on Lebanon are escalating, noting that Lebanon's budget for the upcoming year is estimated at USD 4.7 billion, which falls far short of covering the war's costs and reconstruction efforts. According to estimates from the International Monetary Fund (IMF) and Arab funds, the war's total cost could reach up to USD 10 billion. He also pointed to the repercussions of the attacks on the tourism and industrial sectors, in addition to the devastation of thousands of hectares of agricultural land in southern Lebanon. These economic losses surpass the "capacity of Lebanon's fragile economy" amidst its ongoing crises, making it impossible to precisely estimate the total costs of the war and how Lebanon could finance its reconstruction efforts once the hostil ities end. (MORE) Source: Qatar News Agency