Lebanon 

Lebanon country policy

Policy established 29 November 2006

• Case-by-case assessment
• The country ceiling is 500 mln euro
• Early warning signal 150 mln euro
• - of which was used as at 2012-02-29 0 mln euro

Country class: 7

Risicoduur maximaal 36 maanden, waarvan maximaal 24 maanden krediet

Onherroepelijk accreditief, bankgarantie, garantie Centrale bank (onvoorwaardelijk)

Maximum risk period 36 months, of which 24 months credit risk

ILC, commercial bank or central bank g'tee

Lebanon country facts

Atradius DSB Economic Research

Country Report last updated January 17th, 2012 
Country :  LEBANON  

Political Situation
Very Complicated Power Structure

Head of state
President general Michel Suleiman.

Form of government
Hizbullah-backed government of p.m. Najib Mikati, with a majority of 16 out of 30 seats in parliament.

Internal Economic Situation
High Public Debt Burden

General situation
Lebanon has a services-oriented economy vulnerable to political instability in the country/region. In turbulent 2011 real GDP-growth turned out to be disappointing because of a weak performance in tourism, banking and construction sectors.  But so far Lebanon’s financial sector seems not to be seriously affected by the unrest in Syria (in spite of some capital flight from the country). Inflation is driven by price fluctuations in food and oil that have to be imported: in 2011 nearly 5%. Solid banking sector but with a very high exposure to the public sector. Unfavourable TI-corruption index: 127 out of 178. 
 
External Economic Situation
Solid Liquidity, Weak Solvency

Main sources of foreign exchange
Exports of precious stones and jewellery (31%), machinery (18%). Private transfers of expats, official Arab support, tourism.

Main foreign markets
Syria (26%), UAE (13%), Switzerland (6%), Saudi Arabia (5%).

Main expenses of foreign exchange
Imports of mineral products (21%) and capital goods (20%).

 
Balance of payments
The very high current account deficits are being financed by capital inflows (direct investments from other Arab countries, inflow of non-resident deposits), only part of it  officially recorded. Currency peg to be continued.