The World Bank published the Winter 2025 Lebanon Economic Monitor, “A Fragile Rebound,” reporting that Lebanon’s economy returned to positive growth in 2025, with real GDP expanding by 3.5% amid early macroeconomic stabilization, a rebound in tourism and uneven progress on reforms. The report revised its 2025 growth estimate down to 3.5% from 4.7% (Spring 2025), citing a weaker-than-expected tourism season in the context of ongoing conflict, subdued investment and limited reconstruction spending. It attributes the upturn mainly to higher private consumption supported by strong remittance inflows and greater dollarization of wages, alongside tourism and renewed activity in real estate and construction. Exchange rate stability has held since August 2023; the fiscal balance is expected to move into surplus on a cash basis, while public debt remains high despite a projected decline in the debt-to-GDP ratio due to higher nominal GDP. Headline inflation is projected to fall to 15.2% in 2025 and reach single digits in 2026 for the first time since 2019, reflecting exchange rate stabilization and near-complete dollarization of consumer prices. Looking ahead, real GDP growth is projected at 4% in 2026, conditional on continued reform momentum, modest reconstruction inflows and political stability. While the Monitor notes progress through the passage of economic and judicial laws and key civil service appointments, it identifies pending structural measures, including a “financial gap law” and key sector reforms, and warns that delays on critical reforms and regional instability could undermine the recovery.

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