Lebanon

Investment & 
Operational
Climate

Most analysts assess that Lebanon’s near- and medium-term economic future is bleak, with likely fiscal austerity, continuing capital controls, further devaluation, and a potential loss of value applied to wealthy accountholders to recapitalize the banking sector. The Minister of Finance in May said Lebanon needs USD 28bn in financial assistance over the next four years. The World Bank projected that the poverty rate will reach 40-50% by the end of this year. These developments hold consequences for Lebanon’s potential as a destination for foreign investment. Much depends on how Lebanon implements overdue economic and governance reforms, including in connection with its negotiation and implementation of a potential IMF program. If the country is able to implement necessary reforms, attract foreign capital, stabilize the exchange rate, and recapitalize its financial sector, opportunities remain for U.S. companies. To date, Lebanon has the legal underpinnings of a free-market economy, a highly-educated labour force, and limited restrictions on investors. The most alluring sector is the energy sector, particularly for power production, renewable energies, and oil and gas exploration, though challenges remain with corruption and a lack of transparency. Information and communication technology, healthcare, safety and security, waste management, and franchising have historically attracted investment.