The World Bank released its Lebanon Macro Poverty Outlook report in which it estimated Lebanon’s economy to have contracted by 7.1% in 2024, 0.8% in 2023, and 0.6% in 2022. According to the World Bank, 13 months following the October 7, 2023 events and the escalation of the conflict between Israel and Lebanon in September 2024, a ceasefire agreement between the two countries was inked on November 27, 2024. The conflict resulted in a death toll of more than 3,500, 14,500 injuries, and 1.2 million internally displaced individuals. The World Bank noted that had the conflict not taken place in 2024, Lebanon’s GDP would have contracted by 0.9% instead of 7.1%. The report added that following the aforementioned GDP contraction in 2024, the cumulative decline in Lebanon’s real GDP since 2019 neared 40%, further exacerbating Lebanon’s “multi-pronged” crisis. In addition, the World Bank estimated in its “Rapid Damage and Needs Assessment” report that physical damages resulting from the Israeli aggression on Lebanon amounted to $6.8 billion, while economic losses were estimated at around $7.2 billion and the recovery & reconstruction needs at circa $11 billion. The World Bank report stated that Lebanon’s political paralysis that lasted over two years ended in January 2025 with the election of former army Chief Mr. Joseph Aoun as President and the formation of a new government under Prime Minister Mr. Nawaf Salam on February 8. The World Bank commented in this respect that the formation of a new government committed to undertake reforms is considered a stepping stone for Lebanon to tackle its economic and financial crisis through a comprehensive recovery plan. From another perspective, the report estimated Lebanon’s fiscal surplus at 0.5% in 2024 mainly owing to better than expected revenue collection and spending restraints. More specifically, total government revenues in 2024 (77% of which stem from taxes) reached 15.3% of GDP, faring better than the budget estimates partly due to better than expected tax collections in the first nine months of the year. As per the World Bank, fiscal restraint was facilitated by spending restrictions imposed by BDL on public institutions’ accounts, which resulted in a 45% increase in public sector deposits between January and December 2024. In addition, the report noted that prior to the escalation of the conflict in September 2024 the outgoing government had approved a draft 2025 budget that aimed for a zero fiscal deficit, with both revenues and expenditures estimated at 15.9% of GDP. Said budget was approved by the new government by decree even though it was not discussed in the parliament. In parallel, the World Bank mentioned that Lebanon’s average annual inflation rate fell to 45.2% in 2024 down from 221.3% in 2023 and 171.2% in 2022, a level not witnessed since the year 2020, thanks to the exchange rate stabilization since August 2023. The World Bank noted that despite the harsh economic crisis, Lebanon’s current account deficit remained negative at 22.2% of GDP in 2024, dragged partly by the war’s impact on tourism receipts. The World Bank projected the country’s real economic growth to reach 4.7% in 2025 buoyed by a new era of reforms, tourism sector recovery, increased consumption, and some reconstruction inflows, posting the first growth since the year 2017. Finally, the World Bank estimated the employment rate among the working population (aged 15 and above) to have dropped from 40.5% in 2022 and 2023 to 39.0% in 2024, with projection to reach 37.6% in 2025.