The Economic Activity of Lebanon

Lebanon has been termed as the “Switzerland of the East” for its laudable financial and banking services that has been deemed significant during the onset of oil and petroleum boom in the 1960’s where Lebanon-based banks became the main recipients and vaults of so-called petrodollars. The commercial and investment banking services that Lebanon offers is a top-notch among all Arab countries due to its highly upheld financial secrecy.

Lebanon also boasts of its liberal economy that has its origins since post World War II years when the Port of Beirut became the most important port on the Eastern Mediterranean that served as an open and free port for imported goods going to the Arab world. There are also no restrictions when it comes to foreign investments and foreign exchange.

The mild climate, the historic landmarks, the Mediterranean Sea, the snow-capped mountains, the rolling valleys, and the engaging culture of the country made it a favorite tourist destination in the Arab region. With this, Lebanon also gained the reputation of being the “Paris of the East”.

Despite its economic success, the development of Lebanon is constantly hampered and threatened by political instability. The country was ridden by civil wars that devastated its major infrastructure and modern institutions. It also resulted to a depressing bloodbath that sacrificed both civilians and fighting individuals. In 1996, the county embarked on a massive reconstruction that tested their resiliency following the long civil war (1975-1990) and the Israeli occupation (1978-1990) of the south. This economic recovery led the country to amass a mountain pile of debt which became more pronounced and significant because of the high interest rates applied by lending and banking institutions.