Economy in Lebanon

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Economy—overview: The 1975-91 civil war seriously damaged Lebanon's economic infrastructure cut national output by half and all but ended Lebanon's position as a Middle Eastern entrepot and banking hub. Peace has enabled the central government to restore control in Beirut begin collecting taxes and regain access to key port and government facilities. Economic recovery has been helped by a financially sound banking system and resilient small- and medium-scale manufacturers with family remittances banking services manufactured and farm exports and international aid as the main sources of foreign exchange. Lebanon's economy has made impressive gains since Prime Minister HARIRI launched his $18 billion Horizon 2000 reconstruction program in 1993. Real GDP grew 8% in 1994 and 7% in 1995 before Israel's Operation Grapes of Wrath in April 1996 stunted economic activity. During 1992-97 annual inflation fell from more than 170% to 9% and foreign exchange reserves jumped to more than $4 billion from $1.4 billion. Burgeoning capital inflows have generated foreign payments surpluses and the Lebanese pound has remained relatively stable. Progress also has been made in rebuilding Lebanon's war-torn physical and financial infrastructure. Solidere a $2-billion firm is managing the reconstruction of Beirut's central business district; the stock market reopened in January 1996; and international banks and insurance companies are returning. The government nonetheless faces serious challenges in the economic arena. It has had to fund reconstruction by tapping foreign exchange reserves and boosting borrowing. The stalled peace process and ongoing violence in southern Lebanon could lead to wider hostilities that would disrupt vital capital inflows. Furthermore the gap between rich and poor has widened since HARIRI took office resulting in grassroots dissatisfaction over the skewed distribution of the reconstruction's benefits and leading the government to shift its focus from rebuilding infrastructure to improving living conditions.

GDP: purchasing power parity—$15.2 billion (1997 est.)

GDP—real growth rate: 4% (1997 est.)

GDP—per capita: purchasing power parity—$4 400 (1997 est.)

GDP—composition by sector:

agriculture: 4%

industry: 23%

services: 73% (1997 est.)

Inflation rate—consumer price index: 9% (1997 est.)

Labor force:

total: 1 million plus as many as 1 million foreign workers (1996 est.)

by occupation: services 62% industry 31% agriculture 7% (1997 est.)

Unemployment rate: 18% (1997 est.)

Budget:

revenues: $2.4 billion

expenditures: $5.9 billion including capital expenditures of $NA (1997 est.)

Industries: banking; food processing; jewelry; cement; textiles; mineral and chemical products; wood and furniture products; oil refining; metal fabricating

Industrial production growth rate: 25% (1993 est.)

Electricity—capacity: 1.35 million kW (1997)

Electricity—production: 5 billion kWh (1995)

Electricity—consumption per capita: 1 380 kWh (1995)

Agriculture—products: citrus vegetables potatoes olives tobacco hemp (hashish); sheep goats

Exports:

total value: $1.018 billion (f.o.b. 1996)

commodities: paper and paper products 26% food stuffs 16% textiles and textile products 10% jewelry 8% metals and metal products 8% electrical equipment and products 8% chemical products 6% transport vehicles 4% (1995)

partners: UAE 23% Saudi Arabia 14% Kuwait 8% Syria 7% Jordan 5% France 5% Italy 4% US 3% (1996)

Imports:

total value: $7.559 billion (c.i.f. 1996)

commodities: machinery and transport equipment 28% foodstuffs 20% consumer goods 19% chemicals 9% textiles 5% metals 5% fuels 3% (1995)

partners: Italy 12% US 11% Germany 9% France 8% Syria 4% UK 4% Japan 4% (1996)

Debt—external: $2.3 billion (1997 est.)

Economic aid:

recipient: aid pledges of $3.5 billion for 1997-2001

Currency: 1 Lebanese Lira(LL) = 100 piasters

Exchange rates: Lebanese Lira(LL) per US$1 — 1507L.L (December 2004) 1510L.L (December 2000) 1526.1L.L (December 1998) 1539.5L.L (1997) 1571.4L.L (1996) 1621.4L.L (1995) 1680.1L.L (1994) 1741.4L.L (1993)

Fiscal year: calendar year

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