Lebanese Finance Minister Warns of $20 Billion War Damage, Economy Poised for Further Contraction

Lebanese Finance Minister Warns of $20 Billion War Damage, Economy Poised for Further Contraction
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Lebanon’s Finance Minister, Yassin Jaber, has estimated that the total damages incurred since the outbreak of the ongoing conflict have reached approximately $20 billion, warning that the country’s economy faces further contraction this year.

In statements to the press, Jaber projected that Lebanon’s GDP could shrink by between 7% and 10% in 2026 due to the continuing effects of war, which have caused extensive damage to the nation’s economic and financial infrastructure. The remarks come amid a prolonged financial and economic crisis, characterized by declining economic activity and mounting pressure on public finances, compounded by regional and security challenges.

Jaber emphasized that the government is carefully managing the current economic phase while maintaining monetary and fiscal stability despite the challenging circumstances. He stressed the continuation of the gasoline tax, noting that its removal could exacerbate the fiscal deficit and intensify financial pressures. At the same time, the minister highlighted ongoing efforts to modernize financial management and adapt to evolving economic and regional conditions.

Analysts note that the reported $20 billion in losses underscores the severity of Lebanon’s economic challenges and the urgent need for comprehensive reconstruction plans, fiscal and economic reforms, and strategies to mitigate growing social and livelihood pressures on the population.