Travelers waiting for new information about their flight at the Beirut International Airport in August 2024. (Credit: Olivia Le Poidevin/L'Orient Today)
BEIRUT — Lebanon's Purchasing Managers’ Index (PMI) deteriorated again in August, down to 47.9 points from 48.3 in July, according to the latest update published on Wednesday by BlomInvest. After the assassination of Fouad Shukur, a high-ranking Hezbollah officer, by Israel on July 30 in the southern suburbs of Beirut, and that of Ismail Haniyeh, Hamas political leader, in Teheran the following day, tension rose several notches in the Middle East, causing the security situation to quickly deteriorate in Lebanon.
With Iran and Hezbollah having both announced plans to retaliate, many embassies in Lebanon called upon their nationals to leave the country, while many airlines suspended flights to Beirut. The volatile situation, hitting the tourism sector hard, left the country with a negative economic outlook.
“The most unfortunate thing is the loss of confidence, while the private sector now sees only gloomy prospects for the future,” said Ali Bolbol, head of the Economic Research Department at BlomInvest.
Upon closer examination, the drop in the PMI is due, in particular, to the decline in production levels (from 47.2 points in July to 46.5 points in August), as well as in new orders (from 46.9 points in July to 46.1 points in August). On the other hand, new export orders rose from 47.2 points in July to 47.5 points last month.
The PMI is an index of economic activity in Lebanon. It reflects a drop in activity if its value is below 50 points, and vice versa. If the index value is lower than that of the previous month, it means that the decline has accelerated, and vice versa.