Lebanon Country Intelligence Brief 2026

Renewed war interrupted Lebanon’s 2025 recovery. The brief examines frozen deposits, sovereign default, diaspora ties to Africa and the reforms needed before reconstruction capital can scale.

Executive summary

Lebanon stands between recovery and war. In 2025 a new president and government, a stable pound, balanced budgets and a return of tourists produced growth of about 4%. Renewed war from 2 March 2026 reversed that: the World Bank expects the economy to shrink by 6.4% this year, inflation is back above 17%, and parts of the south remain occupied despite a June ceasefire. The deeper problems predate the war. Deposits of about $80bn have been frozen since 2019, the state has been in default since 2020, and there is no IMF programme. The government wants capital for power, ports, reconstruction and special economic zones; investors want the financial gap law, an IMF agreement and security first.

Key findings

1. Real GDP

   -7.1% (2024); +4.2% (2025) [19, 1]

2. Inflation

   17.53% (Sep 2026); 2025 average 14.8% [3, 23]

3. Reserves

   US$11.40bn liquid FX (Sep 2026); gold US$39.3bn [6, 7]

4. Public debt

   139% of GDP (2025, IMF); US$31.3bn of Eurobonds in default [27, 8]

Economic snapshot

-6.4% World Bank forecast for 2026, a swing of more than ten points from the 4.2% growth of 2025 [1, 10]

Growth in 2025 came from consumption, tourism and remittances after the 2024 war ended [15] . The war that resumed on 2 March 2026 hit the same channels: Beirut airport traffic fell 24% in the first eight months, and the World Bank puts tourism and consumption losses at about $3.6bn [16, 17, 18] . Output has fallen by close to 40% since 2019 [19] .

Area: Size; Indicator: Nominal GDP 2025; Latest value: US$30.6bn (World Bank) to US$33bn (central bank); other estimates up to US$46.3bn [20, 12, 21] 1.

Area: Growth; Indicator: Real GDP; Latest value: -7.1% (2024); +4.2% (2025) [19, 1].

Indicator: Outlook 2026; Latest value: World Bank -6.4%; IIF base case about -12% [1, 22].

Area: Prices; Indicator: Inflation; Latest value: 17.53% (Sep 2026); 2025 average 14.8% [3, 23].

Area: FX; Indicator: Pound per US$; Latest value: 89,500 official since Feb 2024; no active policy rate [4].

Area: External; Indicator: Reserves; Latest value: US$11.40bn liquid FX (Sep 2026); gold US$39.3bn [6, 7].

Indicator: Trade balance; Latest value: Goods deficit US$17.44bn in 2025 [24].

Area: Fiscal; Indicator: Budget 2026; Latest value: LBP 538.4trn (about US$6.0bn), balanced [25, 26].

Indicator: Public debt; Latest value: 139% of GDP (2025, IMF); US$31.3bn of Eurobonds in default [27, 8].

Area: Ratings; Indicator: S&P / Moody's / Fitch; Latest value: SD foreign, CCC+ local / C / withdrawn in 2024 [28, 29, 30].

Area: People; Indicator: Unemployment; Latest value: 29.6%; youth 47.8% (2022, latest survey) [31].

Indicator: Poverty; Latest value: 44% in surveyed areas (2022), up from 12% in 2012 [32].

1 GDP estimates differ widely between the statistics office, the central bank, the World Bank and private estimates; this brief uses the official and World Bank range.

War has pushed prices back up

Inflation fell to 10.9% in January 2026, its lowest in years, then rose to 20.0% in April as fuel and transport costs jumped [33, 34]. In September prices were 17.5% higher than a year earlier, with energy up 38.9% and transport up 35.2% [3]. The pound has held at LBP 89,500 per dollar since February 2024; the central bank governor says it is stable but "not under a fixed exchange rate" [4, 5].

Balanced budgets, unresolved debt

The 2025 budget was issued by decree; the year ended with a cash surplus of about $1.5bn [41, 20] . Parliament passed the 2026 budget on 29 January: revenue and spending of LBP 538.4trn, about $6.0bn, some 21% larger than 2025. Wages and benefits take over half of spending and capital spending only 12% [25, 26] . The 2027 draft, sent to Parliament on 2 October, totals LBP 615trn (about $6.9bn) at zero deficit [42] .

Banks, the IMF and the past year

About $80bn of deposits have been frozen since 2019, and the government's 2022 estimate put financial-sector losses at about $70bn [22, 47] . Parliament amended banking secrecy rules in April 2025 and passed a bank resolution law in July 2025 [48, 49] . Amendments in August 2026 were welcomed by the IMF as a "major step", but on 20 October the Constitutional Council struck down Article 3 of the amending law [50, 51] . The financial gap law, which would repay deposits under $100,000 in cash over about four years, was approved by Cabinet in December 2025 and remains in Parliament, opposed by the banks' association [52, 53, 54] . The 2022 IMF staff-level agreement lapsed [55] , and a September 2026 mission ended without a new one [56] . The IMF now asks for the gap law, a 2027 budget, a medium-term fiscal framework and governance reforms [57] .

Where Lebanon's economy sits

ID: 1; Location: Port of Beirut; Description: CMA CGM terminal.

Trade and investment profile

US$17.4bn Goods trade deficit in 2025: imports of $21.1bn against exports of $3.6bn [24]

Diaspora, tourism and investment

Remittances. Inflows were $6.4bn in 2025 on central bank data; the World Bank estimated $5.8bn for 2024 [12, 78] . About 65% move through informal channels [79] .

Government lens

This is how capital reads Lebanon today, using the same numbers investors use.

3.3 Red flags investors will raise

1 Security. Occupation in the south; talks in Tampa ended without agreement on 22 October [68, 14].

3.5 What strengthens Lebanon's case

Pass the gap law On terms the IMF accepts [111, 57] .

Investor lens

What the state has committed to, where it needs capital, and on what terms.

4.2 Where capital is needed

- Power: grid solar, storage and gas plants; installed solar reached 1,505 MW in 2025, mostly rooftop [112, 66]. - Gas supply: Egyptian and Jordanian gas through the Arab Gas Pipeline [118, 119]. - Reconstruction: housing was the worst-hit sector in 2024, with $4.6bn of damage [19]. - Ports and zones: the Tripoli SEZ seeks a developer and operator [94]. - Airports: Beirut's terminal is over capacity; Qlayaat is being rehabilitated [64, 65]. - Digital and social: $150m of World Bank digital financing [91].

4.5 Policy direction and risk outlook

Lebanon, Israel and the US signed a framework on 26 June linking a phased Israeli withdrawal to disarmament; Hezbollah rejects it, and military talks in Tampa ended on 22 October without agreement [68, 14]. UNIFIL's mandate ends on 31 December 2026 [68]. Gulf ties are thawing, and Qatar pledged support for reconstruction and power on 16 October [87, 123]. Parliamentary elections are due around May 2028 [59].

Where interests meet

9 opportunities where a stated need meets investor appetite: solar and storage, port logistics and diaspora trade finance are ready now

Methodology and data notes

123 statistical releases, official statements and published analyses drawn on for this brief