{
  "id": 2408080,
  "title": "World Bank projects Lebanon's GDP to contract by 6.4 per cent in 2026",
  "url": "https://urgent.news/2026/08/21/world-bank-projects-lebanons-gdp-to-contract-by-6-4-per-cent-in-2026-2408080",
  "topic": "finance",
  "section": "Finance & Markets",
  "published": "2026-08-21T16:19:35.000Z",
  "source": {
    "name": "The National UAE",
    "slug": "the-national-uae",
    "url": "https://www.thenationalnews.com/news/mena/2026/08/21/world-bank-projects-lebanons-gdp-to-contract-by-64-per-cent-in-2026/"
  },
  "original_language": "en",
  "account": "The World Bank has forecast that Lebanon's GDP will shrink by 6.4% in 2026, primarily due to ongoing conflict with Israel. Earlier, Economy Minister Amr Bisat had anticipated a 7% contraction this year. This projection marks a setback after Lebanon experienced a 4.2% growth in real GDP in 2025, largely driven by increased consumption, investment, tourism, and improved economic indicators. However, the recent escalation in conflict in March 2026 has significantly disrupted housing and infrastructure, displaced communities, and hindered supply chains, negatively impacting tourism and domestic demand. Lebanon's economy is highly dependent on imports, making it particularly vulnerable to disruptions in shipping and energy supplies, as seen with the impact of the Iran war. The World Bank's Middle East director, Dahlia Khalifa, emphasized that the country's fragile recovery has been severely undermined by the renewed conflict, highlighting the need for urgent reforms, especially in banking sector restructuring and fiscal management, to restore confidence and mobilize necessary funding for reconstruction and recovery. Lebanon continues to grapple with the aftermath of a severe economic crisis that began in 2019, with the local currency losing over 95% of its value against the US dollar. Informal capital controls imposed by commercial banks have left many citizens without access to their savings. Public debt remains unsustainable, and ongoing debt restructuring negotiations have not yet commenced. Inflation is projected to rise to 17.5% in 2026, driven by supply shortages, increased shipping costs, and rising oil prices, further eroding consumers' purchasing power. Although the Lebanese pound has stabilized at approximately 90,000 to the dollar, the World Bank warns that it could face pressure if foreign inflows decrease or if conflict-related disruptions persist. Israel maintains control over large parts of southern Lebanon and shows no signs of withdrawal, while Hezbollah has shown no willingness to relinquish its weapons, ensuring the situation remains unstable. The World Bank notes that these additional losses exacerbate the damage from the 2024 conflict, making it difficult for Lebanon to fully recover from previous disruptions.",
  "summary": "Lebanon's economy is projected to contract by 6.4 per cent in 2026 due to the Israel -Hezbollah war, the World Bank said on Friday. Earlier this month, Lebanon's Economy Minister Amr Bisat told The National that the country's economy was expected to contract by 7 per cent this year due to the resumption of the conflict in March. The projections deal a blow to a brief window of optimism after…",
  "key_points": [],
  "editors_take": null,
  "illustration": null,
  "coverage": {
    "outlets": 1,
    "also_reported_by": []
  },
  "ai_generated": true,
  "disclaimer": "Summaries, key points and the editor’s take are written by software from other outlets’ reporting and may contain errors — always check the linked original."
}