On Tuesday, local news headlines read: “The World Bank warns… Lebanon’s collapse is near!” Naturally, it created a buzz in an already suffocating Lebanon, especially now that the Caesar Act is coming into force.
Claim: The World Bank expects the collapse of Lebanon between July 15th and August 15th, 2020, including further deterioration of the Lebanese pound, as well as hiking the unemployment rate up to 1.2 million.
Verdict: On the same day, the World Bank issued a statement in which it denied the allegation as follows:
“Further to recent news circulating on some media outlets and social media attributing to the World Bank an alleged ‘prediction of Lebanon collapse’, the World Bank deems it necessary to deny these unsubstantiated reports.”
“The World Bank wishes to confirm that it does not issue such predictions and that its economic monitoring, analyses, and statements on Lebanon are posted on its official Lebanon Country website.”
“The World Bank has been a long-standing partner of Lebanon and the Lebanese people, and reiterates its commitment to support its efforts to address the social, financial, and economic challenges it is enduring.”
Context: After the editor-in-chief of Arab Economic News, Violette Ghazal, published the economic omen, local news picked it up and ran with it.
It seems Ghazal received leaked information that a draft summarizing the bank’s stance on Lebanon is currently circulating in Washington.
According to Arab Economic News, the “contents of the draft drew a pessimistic scenario for the crises that have been ravaging Lebanon for some time” but that it is unclear yet if the bank will include this warning in its new report or not.
It is no secret to any that Lebanon is struggling to save its collapsing economy and the Lebanese people are under duress. JPMorgan just issued a report predicting that the Lebanese economy will recess further in 2021.
However, according to its statement, the World Bank maintains its commitment to help the Lebanese government with its efforts to tackle the many challenges crippling the country.