New report links Lebanese army to economic stability
A report by the Institute of International Finance says the Lebanese economy can be improved by a return to stability.
Despite all the crises that Lebanon has gone through in the last three decades, the Lebanese economy has never suffered a decline like the one today. In addition to worsening corruption, the lack of reform in public administrations and institutions and a growing public debt, the economic crisis has worsened in an unprecedented way.
Since the government of former Prime Minister Najib Mikati — which was characterized as a “one-color” government — came to power in 2011, the economy has been declining. Perhaps the best sign of how bad the economy is, and the government’s powerlessness to improve it, is the growing fiscal deficit accompanied by an alarming drop in the growth rate, which has reached recession levels.
According to a report published by the Institute of International Finance (IIF) on Jan. 22, the economic growth rate decreased from 8% in 2010 to 2% in 2011, to 1.2% in 2012 and 0.9% in 2013. Meanwhile, the deficit rose from 5.5% of gross domestic product (GDP) in 2010 to 5.9% in 2011, to 9.3% in 2012 and 11.2% in 2013.
Everyone realizes the danger of combining growing deficits with declining economic growth, especially in a highly indebted country like Lebanon. It is also worth noting that after the debt-to-GDP ratio reached 135% in recent years, it increased to 144% in 2013 despite the low global interest rates, according to the report.
