Overview
- The World Bank projects a 6.4% contraction in Lebanon’s economy for 2026 and expects inflation to rise to about 17.5%, driven by conflict-related supply shocks and higher shipping and energy costs.
- The March 2 escalation between Hezbollah and Israel sharply interrupted a brief 2025 rebound, damaging housing and infrastructure, disrupting tourism and supply chains, and displacing roughly 1.2 million people.
- Official casualty figures from the Lebanese Health Ministry report about 4,348 dead and 12,703 injured since the March 2 outbreak of fighting.
- The World Bank warns public debt is unsustainable, formal debt-restructuring talks have not started, and the Lebanese pound—recently near 90,000 to the dollar—could come under pressure if foreign inflows decline.
- The bank calls for urgent banking-sector restructuring, stronger fiscal management and external financing to mobilize reconstruction, because finance shortfalls and currency fragility will deepen living-cost pressures and slow recovery.