The financial crisis that is gripping the rest of the world seems to be seeping into Lebanon. A country once thought to be insulated from the economic issues seen everywhere from New York to London to Dubai to Moscow is now beginning to see problems of its own.
One of the main concerns is Lebanon’s reliance on remittances from its citizens working outside of the country. Lebanon depends upon remittances for a large portion of its GDP and, in that situation, even the most prudent economic policy can’t protect one nation from the poor decisions of the rest.
However, Lebanon did not see the rapid rise and fall of real estate prices of other countries and is still believed to be fundamentally sound fiscally. New taxes and lower gas prices are helping. Lebanon’s GDP is expected to fall by half this year.
It is unclear what influence a shrinking GDP could have on the elections, let alone the possibility of tens of thousands of newly unemployed Lebanese returning home.
