Today’s markets analysis on behalf of Hassan Fawaz Chairman & Founder of GivTrade
As Lebanon grapples with the aftermath of its 14-month conflict with Israel, international financial institutions are stepping in to help chart a path toward economic recovery. An International Monetary Fund delegation led by Lebanon mission chief Ernesto Ramirez-Rigo is currently in Beirut for a five-day fact-finding mission that began on March 10, 2025.
The IMF team is meeting with Lebanese authorities, including the newly formed government under Prime Minister Nawaf Salam, to discuss pressing economic issues and potential reforms. This visit represents a critical opportunity for Lebanon to restart negotiations for a comprehensive economic reform program that could include a new aid package.
IMF communications director Julie Kozack described the mission as focused on discussing “near-term priorities, the country’s reconstruction needs and recent economic developments”. The visit comes at a crucial time as Lebanon faces enormous reconstruction challenges.
According to a World Bank report released on March 7, Lebanon’s recovery and reconstruction needs are estimated at $11 billion following the conflict that devastated much of the country. The report, which assessed damage across ten sectors, indicates that $3-5 billion will require public financing, while $6-8 billion will need private investment, primarily for housing, commerce, industry, and tourism.
The economic toll has been severe. Lebanon’s real GDP contracted by 7.1% in 2024, compared to a projected growth of 0.9% had the conflict not occurred. By the end of 2024, Lebanon’s cumulative GDP decline since 2019 approached a staggering 40%.
Housing has been the hardest-hit sector with damages estimated at $4.6 billion, while the commerce, industry, and tourism sectors suffered losses of $3.4 billion nationwide.
The IMF mission could pave the way for Lebanon to formulate a comprehensive economic reform program, potentially unlocking international financial support crucial for reconstruction. However, success will depend on the government’s commitment to implementing reforms, including restructuring the banking sector, which has been a stumbling block in previous IMF negotiations.
As the IMF mission concludes on March 14, all eyes will be on the outcomes and whether Lebanon can secure the international support needed to rebuild its shattered economy and infrastructure.