The International Monetary Fund (IMF) has raised its 2023 GDP forecast for Lebanon, now estimating it at $24 billion, up from $16.2 billion in its June 2023 report. This upward revision reflects the adoption of a new methodology for calculating national accounts, leading to a 50% increase in the estimated GDP value.
The update is part of the IMF's World Economic Outlook (WEO), published during its October meetings, which provides key economic indicators for Lebanon in 2023.
Economic Growth and Nominal GDP
The IMF estimates that Lebanon's real GDP growth for 2023 will be -0.7%, compared to 1% in 2022 and 2% in 2021. In 2020, the economy contracted by 24.6% as a direct result of the multidimensional crisis that began in 2019.
In nominal terms, Lebanon's GDP at current prices is estimated at $24 billion in 2023, slightly down from $24.5 billion in 2022, but higher than $19.8 billion in 2021. Before the 2019 crisis, GDP stood at $50.9 billion.
GDP Per Capita
Lebanon’s GDP per capita is estimated at $4,487 in 2023, remaining nearly stable compared to $4,467 in 2022 but higher than $3,537 in 2021. Before the 2019 crisis, it stood at $8,808.
Average inflation surged to 221% in 2023, up from 171.2% in 2022 and 154.8% in 2021. By contrast, average inflation was just 2.9% before the crisis.
Externally, the current account deficit narrowed to 23.5% of GDP in 2023, down from 27.7% in 2022. However, it remains higher than the 18.1% recorded in 2021 and 15.8% in 2020.
Improvement in Public Finances
One of the few positive developments for 2023 is the budgetary outlook. The budget deficit is estimated at 0.4% of GDP, down from 6.6% in 2022, marking the lowest level in 34 years. As a result, the debt-to-GDP ratio has significantly decreased, from 358% in 2021 to 225% in 2022, and further to 195% in 2023.
This improvement is attributed to an increase in public revenues, which are expected to reach 12.9% of GDP in 2023 (compared to 5.7% in 2022), while public spending amounts to 13.3% of GDP (up from 12.2% in 2022).
It is worth noting that the IMF did not release any forecasts for Lebanon for 2024 in its latest World Economic Outlook report.
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