The bank denied the allegations stating that its action was in par with the 1963 Code of Money and Credit.
There are no restrictions on foreign exchange or capital movement. == History == The 1975–1990 Lebanese Civil War seriously damaged Lebanon's economic infrastructure, cut national output by half, and had major consequences for Lebanon's position as a Middle Eastern entrepot and banking hub.
There have been incessant power cuts and some residents have been calling the blackouts worse than those witnessed in the 1975–1990 civil war. == Trade == Lebanon's trade balance is structurally negative.
Figures prior to 1995 are grossly distorted due to hyperinflation. The following table shows the main economic indicators in 1980–2017. == See also == Agriculture in Lebanon Beirut Stock Exchange Banque du Liban (Central Bank) Lebanese Pound Solidere Tourism in Lebanon List of banks in Lebanon == References == == External links == BSE trade sky high despite tensions – The Daily Star Embassy of Lebanon, Washington D.C.
Nonetheless, the relative appreciation of the Lebanese currency has undermined competitiveness, with merchandise exports falling from 23% of GDP in 1989 to 4% in 2000. In 2001, the government turned its focus to fiscal measures, Increasing gasoline taxes, reducing expenditures, and approving a value-added-tax that became effective in February 2002.
As a result, GDP per capita expanded 353% in the 1990s. 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.
The gap between rich and poor grew in the 1990s, resulting in popular 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. After the end of the civil war, Lebanon enjoyed considerable stability, Beirut's reconstruction was almost complete, and increasing numbers of tourists poured into the nation's resorts.
In late 2000, the government substantially reduced customs duties, adopted export promotion schemes for agriculture, decreased social security fees and restrictions on investment in real estate by foreigners, and adopted an open-skies policy, with positive effects on trade in 1991.
During 1992–98, annual inflation fell from more than 100% to 5%, and foreign exchange reserves jumped to more than $6 billion from $1.4 billion.
Lebanon's economy has made impressive gains since the launch of "Horizon 2000," the government's $20 billion reconstruction program in 1993.
The yearly growth of gross debt between 1993 and 1995 was 123 percent and between 1995 and 2000 was 171 percent.
Real GDP grew 8% in 1994 and 7% in 1995 before Israel's Operation Grapes of Wrath in April 1996 stunted economic activity.
Real GDP grew 8% in 1994 and 7% in 1995 before Israel's Operation Grapes of Wrath in April 1996 stunted economic activity.
The yearly growth of gross debt between 1993 and 1995 was 123 percent and between 1995 and 2000 was 171 percent.
Figures prior to 1995 are grossly distorted due to hyperinflation. The following table shows the main economic indicators in 1980–2017. == See also == Agriculture in Lebanon Beirut Stock Exchange Banque du Liban (Central Bank) Lebanese Pound Solidere Tourism in Lebanon List of banks in Lebanon == References == == External links == BSE trade sky high despite tensions – The Daily Star Embassy of Lebanon, Washington D.C.
Real GDP grew 8% in 1994 and 7% in 1995 before Israel's Operation Grapes of Wrath in April 1996 stunted economic activity.
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.
In 1996, interest payments made up almost 68 percent of that year's budget deficit.
Real GDP grew at an average annual rate of less than 3% per year for 1997 and 1998 and only 1% in 1999.
In August 2019, the USD parallel exchange rate started changing from the official exchange rate; the official exchange rate for the USD had been 1507.5 Lebanese pounds since 1997, while the parallel exchange rate was 1600 Lebanese pounds in the fall of 2019 and would increase to around 4200 Lebanese pounds in May 2020.
Since the lifting of the passport restriction in 1997 (see below), a number of large U.S.
Real GDP grew at an average annual rate of less than 3% per year for 1997 and 1998 and only 1% in 1999.
12% from 1998 32% of the Lebanese people lives in the upper middle class ($15,000–27,000) annually.
19% from 1998 7% of the Lebanese people lives in the highest upper class ($30,000 and above) annually 1% from 1998 == Macro-economic trend == This is a chart of trend of gross domestic product of Lebanon at market prices estimated by the International Monetary Fund with figures in millions of Lebanese pounds.
Real GDP grew at an average annual rate of less than 3% per year for 1997 and 1998 and only 1% in 1999.
Lebanon's economy has made impressive gains since the launch of "Horizon 2000," the government's $20 billion reconstruction program in 1993.
The yearly growth of gross debt between 1993 and 1995 was 123 percent and between 1995 and 2000 was 171 percent.
Economic performance was sluggish in 2000 and 2001 (zero growth in 2000, and estimates between 1.0 and 1.4% in 2001, largely attributed to slight increases in tourism, banking, industry, and construction).
Unemployment is estimated at 14% for 2000 and 29% among the 15-24-year age group, with preliminary estimates of further increases in 2001.
In late 2000, the government substantially reduced customs duties, adopted export promotion schemes for agriculture, decreased social security fees and restrictions on investment in real estate by foreigners, and adopted an open-skies policy, with positive effects on trade in 1991.
Nonetheless, the relative appreciation of the Lebanese currency has undermined competitiveness, with merchandise exports falling from 23% of GDP in 1989 to 4% in 2000. In 2001, the government turned its focus to fiscal measures, Increasing gasoline taxes, reducing expenditures, and approving a value-added-tax that became effective in February 2002.
It has done so at a cost, however, as international reserves declined by $2.4 billion in 2000 and by $1.6 billion in the first half of 2001. For 2002, the government has put primary emphasis on privatization, initially in the telecom sector and electricity, with continued planning for sales of the state airline, Beirut port, and water utilities.
Thus it accumulated significant debt, which by 2001 had reached $28 billion, or nearly 150% of GDP.
Economic performance was sluggish in 2000 and 2001 (zero growth in 2000, and estimates between 1.0 and 1.4% in 2001, largely attributed to slight increases in tourism, banking, industry, and construction).
Unemployment is estimated at 14% for 2000 and 29% among the 15-24-year age group, with preliminary estimates of further increases in 2001.
Nonetheless, the relative appreciation of the Lebanese currency has undermined competitiveness, with merchandise exports falling from 23% of GDP in 1989 to 4% in 2000. In 2001, the government turned its focus to fiscal measures, Increasing gasoline taxes, reducing expenditures, and approving a value-added-tax that became effective in February 2002.
It has done so at a cost, however, as international reserves declined by $2.4 billion in 2000 and by $1.6 billion in the first half of 2001. For 2002, the government has put primary emphasis on privatization, initially in the telecom sector and electricity, with continued planning for sales of the state airline, Beirut port, and water utilities.
Nonetheless, the relative appreciation of the Lebanese currency has undermined competitiveness, with merchandise exports falling from 23% of GDP in 1989 to 4% in 2000. In 2001, the government turned its focus to fiscal measures, Increasing gasoline taxes, reducing expenditures, and approving a value-added-tax that became effective in February 2002.
It has done so at a cost, however, as international reserves declined by $2.4 billion in 2000 and by $1.6 billion in the first half of 2001. For 2002, the government has put primary emphasis on privatization, initially in the telecom sector and electricity, with continued planning for sales of the state airline, Beirut port, and water utilities.
Its share price in the Beirut Stock Exchange has risen sharply in the last year from around US$5.00 in early 2004 to close at US$17.50 on Friday, 23 December 2005. == Salaries of Lebanese == On 15 October 2011, after various unions, including the teacher's union, the general worker's union and others threatened to strike, the minimum wage was raised by 40% (200,000 LBP - $133) to 700,000 LBP ($466).
Between 2005 and 2018, the yearly growth of debt has averaged around 22 percent and in comparison, the GDP growth rate for the same period has been in single digits with an exception of 2009.
The richest captured most of the income growth since 2005: The top 10% saw its income increase by 5 to 15%, while the bottom 50% saw it decrease by 15% and the poorest 10% by a quarter. Lebanese billionaires' wealth represents on average, between 2005 and 2016, 20% of national income as opposed to 2% in China, 5% in France, and 10% in the US. == Fiscal haven == In 2018 Lebanon ranked 11th on the Financial Secrecy Index.
Its share price in the Beirut Stock Exchange has risen sharply in the last year from around US$5.00 in early 2004 to close at US$17.50 on Friday, 23 December 2005. == Salaries of Lebanese == On 15 October 2011, after various unions, including the teacher's union, the general worker's union and others threatened to strike, the minimum wage was raised by 40% (200,000 LBP - $133) to 700,000 LBP ($466).
Government spending amounted to $15.9 billion in 2018, or 23% of GDP. The Lebanese economy significantly expanded after the war of 2006, with growth averaging 9.1% between 2007 and 2010.
The economy witnessed growth, with bank assets reaching over 75 billion US dollars, Market capitalization was also at an all-time high, estimated at $10.9 billion at the end of the second quarter of 2006.
The month-long 2006 war severely damaged Lebanon's economy, especially the tourism sector.
Government spending amounted to $15.9 billion in 2018, or 23% of GDP. The Lebanese economy significantly expanded after the war of 2006, with growth averaging 9.1% between 2007 and 2010.
These regulations have generally left Lebanese banks unscathed by the financial crisis of 2007–2008.
Over the course of 2008 Lebanon rebuilt its infrastructure mainly in the real estate and tourism sectors, resulting in a comparatively robust post war economy.
In late 2008, Moody's shifted Lebanon's sovereign rankings from stable to positive, acknowledging its financial security.
Moreover, with an increase of 51% in the Beirut stock market, the index provider MSCI ranked Lebanon the world's best performer in 2008.
Lebanon is one of the only seven countries in the world in which the value of the stock market increased in 2008.
The Lebanese economy experienced continued resilience, growing 8.5 percent in 2008, 7 percent in 2009 and 8.8% in 2010.
This trade deficit also widened as the remittances share, which was around 24 percent in 2008 declined to nearly 12 percent in 2018.
The Lebanese economy experienced continued resilience, growing 8.5 percent in 2008, 7 percent in 2009 and 8.8% in 2010.
Between 2005 and 2018, the yearly growth of debt has averaged around 22 percent and in comparison, the GDP growth rate for the same period has been in single digits with an exception of 2009.
Government spending amounted to $15.9 billion in 2018, or 23% of GDP. The Lebanese economy significantly expanded after the war of 2006, with growth averaging 9.1% between 2007 and 2010.
The Lebanese economy experienced continued resilience, growing 8.5 percent in 2008, 7 percent in 2009 and 8.8% in 2010.
After 2011 the local economy was affected by the Syrian civil war, growing by a yearly average of 1.7% on the 2011–2016 period and by 1.5% in 2017.
Its share price in the Beirut Stock Exchange has risen sharply in the last year from around US$5.00 in early 2004 to close at US$17.50 on Friday, 23 December 2005. == Salaries of Lebanese == On 15 October 2011, after various unions, including the teacher's union, the general worker's union and others threatened to strike, the minimum wage was raised by 40% (200,000 LBP - $133) to 700,000 LBP ($466).
Others criticized the raises altogether citing that it would burden small business that might end up closing altogether; those critics were mainly opposition politicians. As of 2013 World Bank analysis of Quality Life Index, it was estimated that: 15% of the Lebanese people lives below the poverty line ($2,500) 54% of the Lebanese people lives in the moderate middle class ($9,000) annually.
However, Lebanon's debt to GDP ratio remained one of the highest in the world. The International Monetary Fund issued a second report on Lebanon in October 2015, where its expectations of the economic growth rate were lowered to 2%, compared to the 2.5% growth rate of the first report, released in April 2015. In October 2019, Lebanon witnessed nationwide protests that erupted over the country's deteriorating economic conditions.
As a consequence, interest payments consumed 48% of domestic government revenues in 2016, thus limiting the government's ability to make needed investments in infrastructure and other public goods. The Lebanese economy is service-oriented.
On the one hand, administrators of the UNESCWA used the World Food Programme in May 2016 to sell the story that the country imports up to 80% of its needs.
A poll conducted by Transparency International in 2016 indicated that 92% of Lebanese thought that corruption had increased that year.
The richest captured most of the income growth since 2005: The top 10% saw its income increase by 5 to 15%, while the bottom 50% saw it decrease by 15% and the poorest 10% by a quarter. Lebanese billionaires' wealth represents on average, between 2005 and 2016, 20% of national income as opposed to 2% in China, 5% in France, and 10% in the US. == Fiscal haven == In 2018 Lebanon ranked 11th on the Financial Secrecy Index.
After 2011 the local economy was affected by the Syrian civil war, growing by a yearly average of 1.7% on the 2011–2016 period and by 1.5% in 2017.
In 2017, the trade deficit reached $20.3 billion.
The nominal GDP was estimated $54.1 billion in 2018, with a per capita GDP amounting to $12,000.
Government spending amounted to $15.9 billion in 2018, or 23% of GDP. The Lebanese economy significantly expanded after the war of 2006, with growth averaging 9.1% between 2007 and 2010.
In 2018, the size of the GDP was estimated to be $54.1 billion.
The GDP rate, which reached double digits before the Syrian crisis, declined to around 1 percent in 2018.
Between 2005 and 2018, the yearly growth of debt has averaged around 22 percent and in comparison, the GDP growth rate for the same period has been in single digits with an exception of 2009.
Lebanon in 2018 imported US$20 bn worth of goods and exported goods worth only US$3 bn.
This trade deficit also widened as the remittances share, which was around 24 percent in 2008 declined to nearly 12 percent in 2018.
There are no restrictions on foreign exchange or capital movement. === Food security === Food accounted for 18% of the dollar value of the imports to Lebanon in 2018, according to World Bank statistics.
The richest captured most of the income growth since 2005: The top 10% saw its income increase by 5 to 15%, while the bottom 50% saw it decrease by 15% and the poorest 10% by a quarter. Lebanese billionaires' wealth represents on average, between 2005 and 2016, 20% of national income as opposed to 2% in China, 5% in France, and 10% in the US. == Fiscal haven == In 2018 Lebanon ranked 11th on the Financial Secrecy Index.
Lebanon is part of the Global Forum on Transparency and Exchange of Information for Tax Purposes and has signed an agreement to exchange fiscal data with other countries, but as of January 2019, it is not compliant with certain provisions of the treaty. Ali Hassan Khalil, Finance Minister, confirmed that 2019's draft budget showed a deficit of less than 9% of GDP compared to 11.2% in 2018.
Nassib Ghobril, the head of research and analysis for Byblos Bank, calculates that Lebanese abroad supply Lebanon with about $1,400 per capita every year. == Investment == The stock market capitalization of listed companies in Lebanon was valued at $9.6 billion in January 2019, down from $11.5 billion in January 2018 Lebanon was unable to attract significant foreign aid to help it rebuild from both the long civil war (1975–89) and the Israeli occupation of the south (1978–2000).
However, Lebanon's debt to GDP ratio remained one of the highest in the world. The International Monetary Fund issued a second report on Lebanon in October 2015, where its expectations of the economic growth rate were lowered to 2%, compared to the 2.5% growth rate of the first report, released in April 2015. In October 2019, Lebanon witnessed nationwide protests that erupted over the country's deteriorating economic conditions.
Some of the money that Macron collected would be used by the UNOCHA. === 2019–present economic crisis === According to a World Bank report, Lebanon's public economy which was structurally strained before the Syrian shock became severely strained as an aftermath of the Syrian crisis which brought around 1.5 million Syrian refugees into Lebanon.
In August 2019, the USD parallel exchange rate started changing from the official exchange rate; the official exchange rate for the USD had been 1507.5 Lebanese pounds since 1997, while the parallel exchange rate was 1600 Lebanese pounds in the fall of 2019 and would increase to around 4200 Lebanese pounds in May 2020.
This dollar shortage also caused 785 restaurants and cafes to close between September 2019 and February 2020 and caused 25,000 employees to lose their jobs.
With debt piling up and growth being minuscule, Lebanon's debt to GDP ratio reached 178 percent by the end of 2019, which makes it the third most indebted country after Greece and Japan.
According to reports, the Lira was trading at LBP 8,100 to US$1 in 2019 in the black market.
In November 2019, The central bank of Lebanon was accused of running a Ponzi scheme as it relied on fresh borrowing to service its debt.
In 2019, domestic wheat production measured 130,000 tons, while wheat imports measured 570,000 tons. The food security of Lebanon is a subject of debate.
As of January 2019, banking secrecy applies to Lebanese nationals living in Lebanon but is not applicable to US citizens and US fiscal residents since the FATCA agreement was introduced.
Lebanon is part of the Global Forum on Transparency and Exchange of Information for Tax Purposes and has signed an agreement to exchange fiscal data with other countries, but as of January 2019, it is not compliant with certain provisions of the treaty. Ali Hassan Khalil, Finance Minister, confirmed that 2019's draft budget showed a deficit of less than 9% of GDP compared to 11.2% in 2018.
Khalil also claimed that the economic growth forecast of 1.5 percent could go up to 2% in 2019. == Foreign investment == There are little restrictions on foreign investment, barring Israeli citizens and entities.
Foreign ownership of real estate is legal under certain conditions. According to a report by The Wall Street Journal, "Lebanon has one of the world's highest public debt-to-gross domestic product ratios, rising to over 150% as it takes on more debt to plug budget holes." In January 2019, in a move to boost the economy of Lebanon and help the country overcome its debts, Qatar pledged to buy $500 million's worth of government bonds.
In June 2019, Bloomberg reported that Qatar had bought some of the bonds and planned to complete the rest of the investment soon. === Remittances === Lebanon benefits from its large, cohesive, and entrepreneurial diaspora.
Nassib Ghobril, the head of research and analysis for Byblos Bank, calculates that Lebanese abroad supply Lebanon with about $1,400 per capita every year. == Investment == The stock market capitalization of listed companies in Lebanon was valued at $9.6 billion in January 2019, down from $11.5 billion in January 2018 Lebanon was unable to attract significant foreign aid to help it rebuild from both the long civil war (1975–89) and the Israeli occupation of the south (1978–2000).
In August 2019, the USD parallel exchange rate started changing from the official exchange rate; the official exchange rate for the USD had been 1507.5 Lebanese pounds since 1997, while the parallel exchange rate was 1600 Lebanese pounds in the fall of 2019 and would increase to around 4200 Lebanese pounds in May 2020.
However, despite the central bank's efforts, on 23 June 2020, the black market dollar reached a staggering rate of LL 6,075 devaluing the Lebanese pound by 75%.
This dollar shortage also caused 785 restaurants and cafes to close between September 2019 and February 2020 and caused 25,000 employees to lose their jobs.
In 2020, the country defaulted for the first time on $30 billion in bonds and tried to seek help from the IMF but the negotiations never reached fruition. The liquidity crisis also lead to a restriction on the withdrawals from US Dollar bank accounts.
Also, these depositors turned to buying shares in Solidere company, which lead to a rise of 500% in its price between the start of the liquidity crisis and April 2021. The already battered economy of Lebanon suffered fresh blow with the port blast on 4 August 2020.
In 2020, Beirut defaulted on a $1.2 billion Eurobond, the first sovereign default since in its history.
Also, these depositors turned to buying shares in Solidere company, which lead to a rise of 500% in its price between the start of the liquidity crisis and April 2021. The already battered economy of Lebanon suffered fresh blow with the port blast on 4 August 2020.
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