Lebanon’s fragile economy buckles under risk of Israel-Hezbollah war
The country has seen a sharp decline in business conditions within the private sector since the Oct. 7 attacks.
Since the outbreak of the Hamas-Israel war on Oct. 7 and the increasing skirmishes on Lebanon’s southern border, the country’s beleaguered economy has been hit hard, and experts told Al-Monitor that it won’t be equipped to handle an all-out war with its neighbor.
The headline purchasing managers’ index in Lebanon fell to 48.8 in December, down from 49.5 in November, a survey by BLOMINVEST Bank, one of the country’s largest lenders, revealed Thursday. A score below 50 represents a decline in business conditions within the private sector.
BLOMINVEST Bank called this decline “significant and accelerated.”
“This downturn is attributed to heightened uncertainty among the political class, particularly regarding the potential extension of the army commander's term. Despite containment of regional effects from the Gaza war, Lebanon continues to grapple with a volatile economic environment,” wrote Aline Azzi, research analyst at the bank.
