Lebanon’s economy continues to collapse, prompting fears it may become failed state
The Lebanese economy continues to collapse amid hyperinflation and power outages, prompting an alarming surge in both criminality and food scarcity. A tense situation in Beirut, coupled with hardships induced by the coronavirus pandemic, have accelerated Lebanon’s collapse.
According to the World Bank, the situation in Lebanon is so dire that the country may be witnessing one of the worst three economic depressions since the 19th century.
The organization reports that the country’s gross domestic product (GDP) dropped from close to $55 billion USD in 2018 to an estimated $33 billion USD in 2020, with GDP per capita falling around 40 per cent.
“Such a brutal and rapid contraction is usually associated with conflicts or wars,” the World Bank stated. “This illustrates the magnitude of the economic depression that the country is enduring, with sadly no clear turning point on the horizon, given the disastrous deliberate policy inaction.”
“The social impact of the crisis, which is already dire, could rapidly become catastrophic; more than half the population is likely below the national poverty line,” the World Bank continued. “Lebanon, with a history of civil war and conflicts, faces realistic threats to its already fragile social peace.”
According to the Wall Street Journal, the country’s economic problems have been exacerbated by power outages, which are so frequent that restaurants have to time their hours to the schedule of electricity available from private power generators. The publication reports:
Brawls have erupted in supermarkets as shoppers rush to buy bread, sugar, and cooking oil before they run out or hyperinflation topping 400% for food puts the prices out of reach. Medical professionals have fled just as the pandemic hammers the country with a new wave of infections. Thefts are up 62% and murder rates are rising fast.
The situation in the Middle Eastern country, which borders Israel and Syria, began to teeter last February when its government fell following devastating explosions at the Beirut port that left hundreds dead and thousands more injured. Some 300,000 people were displaced from their homes in the fallout of the destruction.
Following the explosions, Lebanon’s government in Beirut resigned due to widespread protests over the government’s mishandling of both the situation as well as for allowing Hezbollah militia forces to store volatile explosives at the civilian location.
Speaking at the United Nations last September, Israel’s then-prime minister Benjamin Netanyahu said that Hezbollah was storing more explosive weapons in Beirut, the Wall Street Journal reported. “If this thing explodes, it’s another tragedy,” he said. “Iran and Hezbollah have deliberately put you and your families in grave danger.”
Quoting analysts, the Wall Street Journal reports that the situation may likely plunge Lebanon into the status of a failed state.
“Not only do we have an absence of government and a political vacuum, but we’re going to have a severe problem with the function of the state of Lebanon,” Lebanese American University political scientist Imad Salamey told the publication. “We are heading toward the unknown.”
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