Lebanon’s already fragile economy is teetering towards recession due to the ongoing Israel-Hamas conflict, the World Bank announced on Thursday. The recent warfare has notably disrupted tourism, a critical economic sector for Lebanon.
Despite the Lebanese economy showing signs of a marginal recovery in early 2023, the conflict that ignited on October 7 along Lebanon’s southern border, primarily involving the Israeli army and Hezbollah, has undermined these gains.
The World Bank’s report highlights a significant downturn in tourism and remittances from the Lebanese diaspora as key factors in this regression. With more than half of the winter holiday travel bookings canceled, the economic outlook appears bleak.
Lebanon, struggling with deep economic crises and political gridlock, faces a potential GDP contraction of up to 0.9 percent. This downturn comes amidst long-standing political challenges, including the inability to elect a new head of state and a year-long reliance on a caretaker government.