In June I reported that the demonstrations cost Lebanon $2 billion. But that’s risen to a massive $3 billion – making Lebanon’s debt $36 billion. Lebanon’s debt is already the highest in the world.
Why? Because the tourist industry has been destroyed. There’s been a 20% drop in people rediscovering the ‘Paris of the Orient’, ‘The Switzerland of the Middle East’. They had been coming back since the end of the Civil War, but with political assasinations, millions of people on the streets and the release of warlords like Jaja and Aoun to fight their battles again, the West is getting scared of George Bush’s new playground.
Lebanon had 1.5 million visitors last year, a huge amount for a country of just 3 million people. This year the number’s expected to just about hit 1 million.
Lebanon’s tourism minister’s targetting Arab visitors, and rich Lebanese expatriates living in France, Britain, the US and South America (Lebanon has one of the Arab world’s highest number of expats).
Lebanon is almost unique in the Arab world in that it has no oil – it’s economy relies almost completely on tourism. It imports electricity from neighbouring Syria. It also relies heavily on banking – Beirut was the banking centre of the Arab World until the war, a reputation the city’s struggled to rebuild since 1990, but with the post-Hariri events, investors as well as tourists are getting jittery.
No income, and a rapidly growing debt. Money – Lebanon’s coming crisis.