According to the latest report from the United Nations Development Programme (UNDP), Lebanon is expected to face severe economic consequences due to the conflict between Israel and Hezbollah forces, with GDP possibly plunging by about 9%, equating to a loss of approximately 2 billion dollars. The report indicates that the economic impact of this conflict is expected to exceed the damages from the 2006 war, particularly with regard to the destruction of infrastructure, housing, and production capacity.
UNDP also predicts that as the conflict continues, Lebanon's government financing needs will increase by 30%, with the conflict potentially lasting until the end of 2024. This conflict compounds the woes of Lebanon, already mired in economic crisis and political turmoil. In recent weeks, Israel has expanded the range of airstrikes to include southern suburbs of Beirut, major cities in southern Lebanon, and the eastern Bekaa Valley, further worsening the local situation.
The report further points out that the economic losses in Lebanon in 2024 will be even more severe, especially in sectors like trade and tourism. Trade activities are expected to decline by 21% due to border closures and war impacts, and employment in agriculture and construction also faces setbacks. In addition, unexploded ordnance and harmful substance pollution, particularly the use of white phosphorus, pose a severe threat to the environment.
The United Nations anticipates Lebanese government revenues will drop by 9%, with investment activities declining by more than 6% in both 2025 and 2026. Facing these challenges, the UNDP calls for increased international aid to support Lebanon's economic recovery and address long-term social and humanitarian impacts. The Lebanese Crisis Response Minister emphasizes that the country currently needs 250 million dollars per month to assist over 1.2 million people displaced by the war.
In a bid to secure more international aid, France is set to host a summit aimed at providing additional support for Lebanon to navigate the current crisis.
