Moody’s Investors Service, the international rating agency, published on October 4, 2024 an issuer comment on Lebanon in light of the recent escalation of the conflict, commenting that this escalation will weigh negatively on Lebanon’s already frail credit picture “C rating with stable outlook” and hinder the government’s efforts to stabilize the economy through increased dollarization. In details, the rating agency commented that ever since the government has lost access to external financing since its disorderly Eurobond default in 2020, foreign exchange revenues were concentrated in two sources, namely tourism and remittances. The rating agency expects tourism, which represented 20% of the country’s GDP in 2023, to be negatively impacted by the propagation of the conflict, while noting that Lebanese expatriates (who constituted more than 80% of total arrivals in recent years) tend to be less affected by the country’s instability as compared to foreign tourists. Always in the same vein, Moody’s added that Lebanon’s tourism sector has a tendency to recover after instability periods, yet it expected the sizeable infrastructural damage inflicted by the recent hostilities to derail the recovery process. As far as remittances are concerned, which accounted for ~20% of the country’s GDP, the rating agency also expects some disruptions in line with trends recorded during conflict periods. Finally, Moody’s commented that the increase in the number of Internally Displaced Persons is exerting further pressure on the already strained social and health conditions, while adding that any further degradation of infrastructure and public services will derail economic recovery.