2013年-世界发展银行全球_Lebanon_Economic_Monitor_Spring_2013___Growing_Tensions_in_a_Resilient_Economy_52页_2mb

Lebanon Economic Monitor Summary - Spring 2013

Core Content

The Lebanon Economic Monitor provides an analysis of key economic developments and policies in Lebanon from the previous six months, placing them in a broader global and regional context. It highlights the challenges posed by political instability and the Syrian conflict, and evaluates the implications for the economy and its future outlook.

Main Points

Economic Growth and Performance

• Growth slowdown: Lebanon's economic growth decelerated sharply in 2012, reaching 1.4%, the lowest since 2006.
• Political and security impact: The domestic political standoff and escalating Syrian conflict significantly hampered growth, especially from the second half of 2012 onwards.
• Favorable outlook: If political and security conditions improve, growth is projected to reach 2.3% in 2013.
• Regional volatility: Lebanon's growth has been more volatile than the regional average due to security shocks.

Demand Side

• Government consumption: A robust increase in government spending supported growth in 2012, despite weak private consumption due to security concerns.
• Consumer confidence: Dropped to a record low, with the Byblos Bank/AUB index showing significant declines, reflecting uncertainty in the security environment.

Supply Side

• Services sector: Historically the strongest growth driver, the services sector, especially tourism, stalled in 2012.
• Tourism impact: Passenger arrivals dropped by 12.3% (seasonally adjusted) in 2012 and further by 3.6% in Q1 2013, primarily due to the Syrian conflict.
• Industrial production: Continued to be weak, with managers' opinions on production remaining negative and inventories below normal levels.
• Construction sector: Contraction in cement deliveries and construction permits indicated a slowdown, with some recovery observed in Q1 2013.

Fiscal Policy

• Fiscal expansion: A major fiscal expansion occurred in 2012, with the primary fiscal balance deteriorating by 4.6 percentage points of GDP.
• Fiscal deficit: Increased to 9.4% of GDP in 2012, up from 5.7% in 2011.
• Public sector wage increase: A significant increase in public sector salaries, driven by a cost-of-living adjustment, contributed to rising deficits.
• EdL transfers: Transfers to the electricity company accounted for 61% of the government deficit in 2012, highlighting a structural fiscal issue.
• Revenue decline: Total revenue fell by 1.4% of GDP, with both tax and non-tax revenues declining due to the VAT exemption on diesel and reduced corporate profits.

Monetary Policy and Inflation

• Inflationary pressures: Despite weak economic activity, inflationary pressures increased, with headline inflation rising to 5.3% by end-2012.
• Core inflation: Also increased, reflecting persistent domestic pressures such as higher disposable income and a cumulative output gap.
• Monetary policy: The Banque du Liban introduced a subsidized interest rate program in January 2013, aimed at boosting economic activity, with a potential GDP growth boost of 0.2 to 0.3 percentage points.

Balance of Payments and External Debt

• Narrowing deficit: The balance of payments deficit narrowed in 2012 due to improved capital inflows.
• Trade deficit: Continued to shrink, though at a slower pace than expected, due to the impact of the Syrian conflict.
• Foreign debt: The share of foreign currency-denominated public debt increased to 42.3%, raising exchange rate risk.
• Dollarization: The dollarization rate of deposits remained stable, with foreign deposits continuing to flow into the country due to wide interest rate spreads.

Impact of the Syrian Conflict

• Humanitarian crisis: The conflict has created a significant humanitarian crisis, with Lebanon hosting a large number of Syrian refugees.
• Economic impact: The conflict negatively affects trade routes, tourism, and labor markets, while real estate and banking sectors have shown resilience.
• Inflation: Increased due to substitution of Syrian goods with more expensive alternatives and localized price pressures from refugee influx.
• Social tensions: The influx of refugees has created employment and wage pressures for host communities, leading to social tensions and reduced access to public services.

Labor Market Trends

• Unemployment: High, with rates reaching 11%, similar to the regional average.
• Youth and women: Unemployment rates are particularly high for youth (34%) and women (18%).
• Productivity mismatch: Jobs are concentrated in low productivity sectors, despite a high number of skilled graduates.
• Structural reforms: Needed to address employment bottlenecks, improve fiscal policy, and enhance the business environment.

Key Information

• Fiscal challenges: The fiscal deficit is expected to remain broadly unchanged in 2013 without revenue measures.
• Policy recommendations: Include consolidating fiscal policy, reforming the social insurance system, and upgrading labor market programs.
• Data issues: Lebanon's national accounts are outdated and of poor quality, hindering effective economic monitoring.
• International support: Urgent need for international financial assistance to support Lebanon's hosting efforts and stabilize the economy.

Conclusion

Lebanon's economy faces significant challenges due to political instability and the Syrian conflict. While growth is expected to improve with better security conditions, risks remain high. Fiscal consolidation and structural reforms are essential to address long-term economic sustainability and social tensions. The quality of economic data and the need for international support are also critical factors in navigating these challenges.