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Remittances key for Lebanon’s economy

In economically and politically stagnant Lebanon, expatriate remittances provide a relatively steady inflow of hard currency and serve as a social safety net and cushion.
World Bank President Jim Yong Kim shakes hands with Lebanon's Minister of Economy and Trade Allan Hakim (L) upon his arrival at Beirut international airport June 2, 2014. REUTERS/Hasan Shaaban (LEBANON - Tags: POLITICS BUSINESS) - RTR3RVNB
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Expatriate remittances are one of the few indicators that recently brought hope for and strengthened confidence in the Lebanese economy despite the current recession. According to the World Bank report “Migration and development brief 23,” issued Oct. 6, remittances for 2014 could reach $7.7 billion, or approximately 17% of Lebanon's gross domestic product (GDP), a 1.6% increase over 2013 figures. Thus, Lebanon came in second in the Middle East in terms of remittances in 2014, behind Egypt and ahead of Morocco and Jordan.

Remittances have always constituted one section of the Lebanese economy, representing an essential part of the country's GDP. Lebanon was ranked first regionally and 13th globally in remittance-to-GDP ratio, which amounted to 17% for 2013. Moreover, remittances are the basic source of hard currency for achieving stability in Lebanon's current account balance, especially in a country suffering from a structural trade deficit. In addition, remittances often take the form of household assistance, and in this instance are essential in driving consumption. They also allow for the weaving of a safety net for controlling the spread of poverty and providing social services, most notably education and health care.

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