World Bank Expects 6.4% Contraction and 17.5% Inflation as Poverty Widens
A recent World Bank report paints a gloomy picture of Lebanon's economy, expecting a 6.4% contraction and inflation of about 17.5%, with unemployment widening to more than 30%. Three UN reports indicate that 55% of families cannot secure three meals a day, amid eroding purchasing power and slowing shopping activity. On prices, gasoline and diesel fell this week, while the gas cylinder rose to 1,383,000 lira from 1,333,000 lira. Economy and Trade Minister Amer Bisat warned that if the situation continues, it could lead to a recession approaching 10 percent.
Gasoline and Diesel Down, Gas Cylinder Up
Fuel prices fell this week: the 95-octane gasoline canister dropped to 2,825,000 lira from 2,837,000 lira, 98-octane to 2,843,000 lira from 2,854,000 lira, and diesel to 2,692,000 lira from 2,726,000 lira. In contrast, the 10-kg gas cylinder rose to 1,383,000 lira from 1,333,000 lira. According to UN reports, 55% of families cannot secure three meals a day, while a press report notes rising prices of goods and services and slower shopping activity in Beirut's major stores.
Unemployment Above 30% and a Warning of a Recession Near 10%
A recent World Bank report estimated unemployment widening to more than 30%, with the poverty line rising and households' purchasing power eroding. Economy and Trade Minister Amer Bisat warned that if the situation continues, it could lead to an economic recession approaching 10 percent. This comes amid slowing shopping activity and price pressures on family budgets.
Education, Sanitation and Concerns Over Missing Fuel Reserves
The Parliament's Education, Higher Education and Culture Committee discussed the Education Ministry's plan for the 2026-2027 school year and the measures taken to ensure an orderly start. The National Litani River Authority also sent a letter demanding faster implementation and completion of sanitation projects and treatment plants in the Litani basin and Lake Qaraoun. On basic services, expert Jassem Ajaka warned of the absence of strategic fuel reserves.
Delayed Reforms and Banking-Industrial Uncertainty
The World Bank report attributes its gloomy picture to the ongoing war and its fallout on sectors, and to delays in the reforms required by the International Monetary Fund. The tourism sector recorded losses and a decline, while the banking and industrial sectors still face uncertainty. On the administrative side, the media office of the Supreme Judicial Council announced a new mechanism to track commercial register files after they were evacuated and moved to alternative locations.
Expectations of Further Pressure on Households
The World Bank expects the economy to contract by 6.4% and inflation to rise to about 17.5%, with poverty widening and unemployment above 30%. The report attributes this to the ongoing war and its fallout and to delayed reforms. A press report points to additional pressures from the fallout of the Strait of Hormuz crisis, the Russian refineries crisis and the chronic trade deficit.
What to watch
- Fuel prices in the next pricing round, after gasoline and diesel fell and gas prices rose.
- Any developments in the reform path required by the International Monetary Fund in light of the World Bank report.
- The start of the 2026-2027 school year and the measures announced by the Education Ministry.
- The sanitation file in the Litani basin and Lake Qaraoun, and the completion dates of stalled projects.