Lebanon is suffering an economic meltdown that began in 2019 when the financial system collapsed under colossal state debts and the unsustainable way they were funded, while politicians have yet to come up with a rescue plan.
- Gross domestic product has plunged to an estimated $20.5 billion in 2021 from about $55 billion in 2018, the kind of contraction usually associated with wars, the World Bank says, ranking the collapse as one of the worst globally since the mid-19th century.- The Lebanese pound has lost more than 90% of its value, driving up the cost of almost everything in a country reliant on imports, and demolishing purchasing power.
- The financial system has suffered eyewatering losses, including about $44 billion at the central bank related to failed efforts to prop up the currency, according to 2020 government figures, a level that is roughly twice the size of economic output. Overall losses, including anticipated sovereign debt write-downs, are even bigger.
- Reliant on imported fuel, Lebanon is facing an energy crunch. Even before the crisis, power supplies were in short supply, including in the capital. Now households are lucky to receive more than an hour or so a day. Fuel prices have soared. A ride in a shared taxi, a popular form of transport, cost 2,000 pounds before the crisis but now costs about 30,000 pounds.
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