Economy of Lebanon - History

History

The 1975-90 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. After the war, the central government regained its ability to collect taxes and control over key port and government facilities. 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. Lebanon's economy has made impressive gains since the launch of "Horizon 2000," the government's $20 billion 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. Real GDP grew at an average annual rate of less than 3% per year for 1997 and 1998 and only 1% in 1999. 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. 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. Reducing the government budget deficit is a major goal of the current government. 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.

Read more about this topic:  Economy Of Lebanon

Famous quotes containing the word history:

    All history and art are against us, but we still expect happiness in love.
    Mason Cooley (b. 1927)

    Well, for us, in history where goodness is a rare pearl, he who was good almost takes precedence over he who was great.
    Victor Hugo (1802–1885)

    I believe that in the history of art and of thought there has always been at every living moment of culture a “will to renewal.” This is not the prerogative of the last decade only. All history is nothing but a succession of “crises”Mof rupture, repudiation and resistance.... When there is no “crisis,” there is stagnation, petrification and death. All thought, all art is aggressive.
    Eugène Ionesco (b. 1912)