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flag Lebanon Lebanon: Economic and Political Outline

Economic Indicators | Foreign Trade in Figures | Sources of General Economic Information | Political Outline

Economic Indicators

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. Since the Israeli invasion and aerial attacks, 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.

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)

 
Main Indicators 2009201020112012 (e)2013 (e)
GDP (billions USD) 34.9239.24e41.46e44.9048.26
GDP (Constant Prices, Annual % Change) 8.57.5e1.5e3.54.0
GDP per Capita (USD) 9,05410,041e10,474e11,19711,881
General Government Gross Debt (in % of GDP) 146.5134.1126.4125.0124.2
Inflation Rate (%) 1.24.55.9e5.03.6
Current Account (billions USD) -3.38e-4.28-6.09-6.18-6.33
Current Account (in % of GDP) -9.7e-10.9-14.7-13.1-

Source: IMF - World Economic Outlook Database ; World Bank , Last Available Data

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
Value Added (in % of GDP) 5.4 16.3 78.2
Value Added (Annual % Change) 4.0 3.5 9.9

Source: World Bank - Last Available Data.

 
 
Monetary Indicators 20062007200820092010
Lebanese Pound (LBP) - Average Annual Exchange Rate For 1 USD 1,507.501,507.501,507.501,507.501,507.50

Source: World Bank - Last Available Data.

 
 
Learn more about Market Analysis about Lebanon on Globaltrade.net, the Directory for International Trade Services.
 

Indicator of Economic Freedom

Score:
60.1/100
Position:
Moderately free
World Rank:
84/179
Regional Rank:
9/17

Distribution of Economic freedom in the world
Source: 2011 Index of Economic freedom, Heritage Foundation

 

Country Risk

See the Country Risk Analysis Provided By Ducroire.

 

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Foreign Trade in Figures

Lebanon has strengthened its openness to international trade by signing an Association Agreement with the EU, by working toward accession to the WTO, and by signing a free-trade agreement with the Gulf Cooperation Council (GCC) in May 2004. According to half-year figures published by the Lebanese Higher Council for Customs, the total value of imports and exports reached almost 11 billion USD at the end of June 2010, an increase of around 12% compared to the level reached at the end of June 2009. The current share of foreign trade in the country’s GDP is around 65%. Its three main export partners are Iraq, Switzerland, and Syria. Lebanon mainly exports pharmaceutical products, textiles, tobacco, pearls & precious stones, electric & electronic equipment, iron & steel, salt, sulfur and machinery. Its three main import partners are Italy, France and Germany. The country mainly imports mineral fuels, oil, vehicles, machinery, pearls & precious stones, electric and electronic equipment. In the first half of 2010, the trade deficit reached 9.8 billion USD, an increase of 12% which reflects a certain vigor of domestic demand.

 
Foreign Trade Indicators 20062007200820092010
Imports of Goods (million USD) 9,64712,25116,75416,57418,460
Exports of Goods (million USD) 2,8143,5744,4544,1875,021
Imports of Services (million USD) 8,7209,97313,44514,301-
Exports of Services (million USD) 11,56512,74417,55816,869-
Imports of Goods and Services (Annual % Change) -3.217.216.96.58.3
Exports of Goods and Services (Annual % Change) -0.913.813.75.37.8
Imports of Goods and Services (in % of GDP) 42.148.253.546.546.2
Exports of Goods and Services (in % of GDP) 21.323.024.422.021.7
Trade Balance (million USD) -6,115-7,880-11,010-11,179-12,263
Trade Balance (Including Service) (million USD) -3,269-5,114-6,900-8,340-10,004
Foreign Trade (in % of GDP) 63.471.277.968.567.9

Source: WTO - World Trade Organization ; World Bank , Last Available Data

 

Main Partner Countries

Main Customers
(% of Exports)
2010
Switzerland 11.8%
United Arab Emirates 9.8%
France 8.2%
South Africa 8.1%
Iraq 6.3%
See More Countries 55.8%
Main Suppliers
(% of Imports)
2010
United States 10.7%
China 9.1%
Italy 7.8%
Germany 7.0%
France 6.7%
See More Countries 58.8%

Source: Comtrade, Last Available Data

 

Main Products

Main Exports
(% of Exports)
2010
Gold, incl. gold plated with platinum, unwrought...Gold, incl. gold plated with platinum, unwrought or not further worked than semi-manufactured or in powder form 19.5%
Tanks and other armoured fighting vehicles,...Tanks and other armoured fighting vehicles, motorized, whether or not fitted with weapons, and parts of such vehicles, n.e.s. 7.8%
Ferrous waste and scrap; remelting scrap ingots of...Ferrous waste and scrap; remelting scrap ingots of iron or steel (excl. slag, scale and other waste from the production of iron or steel; radioactive waste and scrap; fragments of pigs, blocks or other primary forms of pig iron or spiegeleisen) 4.3%
Diamonds, whether or not worked, but not mounted...Diamonds, whether or not worked, but not mounted or set (excl. unmounted stones for pick-up styluses, worked stones, suitable for use as parts of meters, measuring instruments or other articles of chapter 90) 4.0%
Automatic data processing machines and units...Automatic data processing machines and units thereof; magnetic or optical readers, machines for transcribing data onto data media in coded form and machines for processing such data, n.e.s. 3.1%
See More Products 61.3%
Main Imports
(% of Imports)
2010
Petroleum oils and oils obtained from bituminous...Petroleum oils and oils obtained from bituminous minerals (excl. crude); preparations containing >= 70% by weight of petroleum oils or of oils obtained from bituminous minerals, these oils being the basic constituents of the preparations, n.e.s.; waste oils containing mainly petroleum or bituminous minerals 18.9%
Motor cars and other motor vehicles principally...Motor cars and other motor vehicles principally designed for the transport of persons, incl. station wagons and racing cars (excl. motor vehicles of heading 8702) 7.9%
Gold, incl. gold plated with platinum, unwrought...Gold, incl. gold plated with platinum, unwrought or not further worked than semi-manufactured or in powder form 4.5%
Medicaments consisting of mixed or unmixed...Medicaments consisting of mixed or unmixed products for therapeutic or prophylactic uses, put up in measured doses "incl. those in the form of transdermal administration" or in forms or packings for retail sale (excl. goods of heading 3002, 3005 or 3006) 4.2%
Bars and rods, of iron or non-alloy steel, not...Bars and rods, of iron or non-alloy steel, not further worked than forged, hot-rolled, hot-drawn or hot-extruded, but incl. those twisted after rolling (excl. in irregularly wound coils) 1.9%
See More Products 62.5%

Source: Comtrade, Last Available Data

 
See More Products
More imports (Intracen Data)
More exports (Intracen Data)
 

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Sources of General Economic Information

Ministries
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
Search Engines
Al Mashriq
Lebanon Links
Libanis
Upgo
Economic Portals
An Nahar: the country'smost important paper

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Political Outline

Executive Power
The President is the head of the state and is elected by the National Assembly for a six-year term. The Prime Minister is appointed by the President in consultation with the National Assembly and acts as the head of the government, to serve a four year term. Though the Prime Minister enjoys the executive powers which include implementation of the law in the country and running the day-to-day affairs, the President also holds a strong and influential position which includes promulgation of laws passed by parliament and ratification of treaties. The Cabinet is chosen by the Prime Minister in consultation with the President and members of the National Assembly. As per the constitution of the country, the President must be a Maronite Catholic Christian and the Prime Minister a Sunni Muslim.
Legislative Power
The legislature in Lebanon is unicameral. The parliament called National Assembly consists of 128 seats; with its members elected by popular vote on the basis of proportional representation, with quotas according to religion,  to serve four-year terms. Legislative power is vested in both the government and the parliament. The executive branch of the government is directly or indirectly dependent on the support of the parliament, often expressed through a vote of confidence. The Prime Minister cannot dissolve the parliament nor can he veto its enactments. The Speaker of the Parliament must be a Shi'a Muslim.
Main Political Parties
Lebanon has numerous political parties, but they play a much less significant role in the country’s politics than they do in most parliamentary democracies. Coalitions usually exist only for contesting elections, and rarely form a cohesive bloc in the National Assembly after the election. Some of the major political parties in Lebanon are:

- Current for the Future – a political movement and a major political party in Lebanon;
- Progressive Socialist Party – ideologically secular and officially non-sectarian, but in practice follows the Druze faith;
- Hope Movement – advocates greater respect and resources for Lebanon's Shi'ite population;
- Party of God (Hezbollah) - Shi'a Islamist militant organization, supported by Iran;
- LF (Lebanese Forces) – a former militia but now a secular political party, supported mainly by Christians;
- The Lebanese Phalanges (Amine Gemayel);
- The National Liberal Party (Dory Chamoun);
- The Democratic Renewal Movement (Nassib Lahoud);
- The Movement of the Democratic Left (Atallah Elias);
- The Syrian Nationalist Social Party (Ali Qanso);
- The Free Patriotic Movement (Michel Aoun).
Current Political Leaders
President: Michel SULAYMAN (as of 25 May 2008)
Prime Minister: Samir MOQBIL (since 7 July 2011) .
Next Election Dates
National Assembly elections in 2014.
 

Indicator of Freedom of the Press

World Rank:
78/178
Evolution:
17 places down compared to 2009

Source: Worldwide Press Freedom Index 2010, Reporters Without Borders

 

Indicator of Political Freedom

Ranking:
Partly Free
Political Freedom:
5/7
Civil Liberties:
3/7

Map of freedom 2010
Source: Freedom House

 

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Last Updates: January 2012