Although shattered by conflict and undermined by an ongoing political crisis, Lebanon has some good news: the economy is still growing, with economists predicting 2.4% growth in 2008, up from an estimated 2% in 2007. Better still, the country’s bigger banks have once more ridden out crisis, positioning themselves as players in the competition to reinvest the neighbouring Gulf region’s huge liquidity.
On the downside, the fragile political environment is holding back crucial economic reforms. These include reforms pledged at the Paris III donor’s conference in 2007, the privatisation of two GSM mobile phone licences and the restructuring of state utility Électricité du Liban, which supplies 85% of Lebanon’s electricity and has been looking for a private sector investor since 2003.
