Mar Mikhael Street in Beirut. (Credit: Sandrine Frem and Pao Ibrahim/ L'Orient Today)
• In 2023, Lebanon received $6.7 billion in remittances — funds received by a country from its diaspora — according to the latest report published by the Global Knowledge Partnership on Migration and Development (KNOMAD) and the World Bank Group.
Remittances accounted for 30.7 percent of Lebanon's gross domestic product (GDP), the third highest percentage in the world, behind Tonga (41 percent) and Tajikistan (39 percent).
Outward remittance flows from Lebanon to foreign countries were estimated at $1.77 billion in 2023, up slightly from $1.73 billion in 2022, a 2.1 percent increase. However, this remains significantly below the pre-crisis level of $4.33 billion in 2019. The shortage of U.S. dollars in the Lebanese market during the first two years of the crisis made it nearly impossible to pay migrant workers in foreign currency. Consequently, migrant workers — no longer paid in dollars, if at all — could not send money back to their home countries, causing outward remittances to drop by more than half compared to 2019.
• Beirut ranked as the 113th most expensive city in the world, according to Numbeo's latest annual Cost of Living Index, which covered 178 cities in the first half of the year.
Despite Lebanon's ongoing crisis since 2019, which has significantly reduced private and public salaries, the capital ranked 9th out of 21 cities in Western Asia, scoring 45.2 points.
The city's affordability challenges are compounded by its low quality of life ranking. In Mercer's winter 2023 ranking, Beirut placed 184th out of 241 cities worldwide and 14th in the region.
• The Financial Action Task Force (FATF), the international financial crime watchdog, has been considering placing Lebanon back on its "grey list," following an initial assessment in 2023 that deemed the country's efforts against money laundering and terrorist financing insufficient.
Banque du Liban's (BDL) caretaker governor, Wassim Manssouri, left Beirut at the end of the week for Washington, where he is set to hold talks with several financial officials in an attempt to obtain a new reprieve for Lebanon, which risks being placed back on the FATF watchlist next autumn. Before his return on July 15, the caretaker governor is also scheduled to meet officials from the International Monetary Fund (IMF) and the World Bank.
• The Lebanese Petroleum Authority (LPA), a division of the Ministry of Energy, has extended the deadline until March 17, 2025, for companies seeking to participate in a tender to acquire exploration and exploitation licenses for nine blocks within Lebanon's Exclusive Economic Zone (EEZ).
According to documents released online, nine out of 10 blocks in the EEZ are included in the tender, including Block No. 4 (situated off the coast of Batroun in the southern tip of North Lebanon). Previously explored without success in 2020 by the consortium TotalEnergies/Eni/Novatek, the block is now under TotalEnergie/EniQatarEnergy following Russia's departure amid international tensions related to the Ukraine war.
• The Lebanese army has received an additional $20 million from Qatar to support its troops and help ease the impact of the economic crisis on its soldiers, according to a statement from the Army reported by the official National News Agency (NNA).
The aid is part of an earlier $60 million package announced in 2022. The funds are set to "be distributed equitably to soldiers once administrative procedures are finalized,” the statement read.
• The price per kilowatt-hour (kWh) for private or neighborhood generators, which supplement electricity shortages from EDL, has decreased for the fifth consecutive month, now set at 31,725 Lebanese pounds (LL) for June bills, down from 32,269 LL in May, according to the grids published by the Ministry of Energy and Water.
This 1.7% decrease brings the total reduction over five months to nearly 7.5%, according to L'Orient Today’s calculations. The exchange rate used in the ministry's calculations remains constant at LL89,700 to the dollar. The average price of fuel oil has also dropped from LL1,627,264 per 20 liters in February to LL1,482,583 for June bills, a decrease of 8.9%, according to the ministry's calculations.
• The Purchasing Managers’ Index (PMI), developed and published by Blominvest, continues to decline slightly, from 47.9 in May to 47.8 in June.
Despite three consecutive months of decline, the index remains well above its worst level in recent years—30.9 points, reached in April 2020 during the first year of the country's economic crisis.
The PMI is calculated as a weighted average of five components: new orders, production, employment, supplier delivery times and purchasing inventories. Values above 50 reflect an improvement in business conditions, while values below 50 indicate a deterioration in business activity. The further the PMI value is from 50, the more pronounced the trend.
• Air traffic at Beirut International Airport has been severely affected by Israel’s war on Gaza, which has spilled over into a conflict between Hezbollah and Israel on Lebanon's southern border since 8 October.
The number of arriving passengers fell by 9.1% to 2,168,173 between October 2023 and June 2024, compared with 2,385,368 over the same period last year. The number of departing passengers totaled 2,149,035 during the nine months under review, down 5.56% from 2,275,629 passengers recorded between October 2022 and June 2023.
Aeronautical activity at the airport also fell by 8.98%, with 36,125 take-offs and landings recorded between October 2023 and June 2024, compared with 39,692 previously.
• After producing gin, wine, and arak, the Malak brothers are now venturing into brewing beer. Their brand, "Malak," is the latest addition to Lebanon's expanding range of craft beers in recent years.
Since the launch of 961 Beer in 2006, Colonel in 2014, and Elmir in 2018, Malak Beer has become the fourth craft brewery to introduce its range of bottled beers. It joins a growing number of bar-breweries that offer their own brews, such as Vagabond in Beirut's Badaro district and Amro in Ferzol, Bekaa.
• Fuel prices in Lebanon increased on Friday morning, particularly for generator diesel, while domestic gas canisters remained stable, according to the latest data from the Energy and Water Ministry. Here are the new rates:
Analysis of the week
In an unconventional move for a central bank, BDL has been operating without a monetary policy, unable to utilize one of its main tools — the interest rate. BDL also appears to be reverting to a fixed exchange rate system, which in the past proved costly to maintain for Lebanon, contributing to the severe economic crisis, among other challenges. Read Mounir Younes’ piece:
