The fruit and vegetable section of a supermarket in Broumana (Metn). (Credit: Illustration by P.H.B./L'Orient Le-Jour)
BEIRUT — “Rice, sugar, lentils and detergent. Add some cheese or ham, that’s at least $100 gone, just like that,” says Joyce*. Last year, the same basket cost her around $80.
At an age when she should be enjoying retirement, the 71-year-old esthetician is forced to keep working to make ends meet in a country that offers her no social protection. She, like all other Lebanese people, has her savings illegally trapped in banks since the onset of the economic crisis in 2019.
As summer approaches, complaints about Lebanon’s rising costs are growing, and for many, they’re not new. “We already felt how expensive life was getting last year, and this year it’s only getting worse,” said Lara*, a 28-year-old consultant.
“I haven’t been able to go out for less than $40 to $50 a night lately,” she added, pointing out that this excludes extras like valet parking, which now costs as much as $5 in Beirut, where parking spots are scarce in hip areas at night. For her, it’s not just leisure that’s becoming more expensive, it’s “basic, everyday living.”
“I used to pay $9 for a pair of contact lenses last year – today, they cost me $15,” Lara noted. It’s a pattern she’s noticed across the board: her gym membership, $80 a month in 2024, has now climbed to $100. “Even the firewood we buy in winter to keep warm has become more expensive this year.”
Lebanon’s economic collapse wiped out over 98 percent of the local currency, while inflation skyrocketed.
Following the recent war between Hezbollah and Israel, Lebanon is expecting an influx of tourists and expatriates this summer, particularly after certain Gulf countries lifted travel restrictions for their nationals.
“It feels like businesses are taking advantage of the return of expatriates and tourists. But in the end, it’s the locals like us who are paying the price,” she stressed.
Brutal price adjustments
“Despite the Lebanese Lira stabilizing at LL89,700 a dollar since the summer of 2023, prices climbed 30 percent,” said Kamal Hamdan, director of the Consultation and Research Institute, a development and business consulting firm.
This upward trend persists even as Lebanon’s inflation rate, which soared into triple digits during the peak years of the crisis, dropped to double digits last year. In 2024, the average annual inflation stood at 45.24 percent, a significant decline from 221.3 percent in 2023, still high, nonetheless, according to figures from the Central Administration for Statistics (CAS).
With an economy now largely dollarized, Hamdan offers two explanations for the persistent price hikes. First, “some sectors of the economy were slower to adjust their prices in Lebanese Lira to reflect the devaluation, and when the adjustment came, it was abrupt,” he explains, citing as an example education-related fees, which recorded a year-on-year increase of 30.74 percent in April.
For Samia*, a 32-year-old engineer, “rent prices went up during the war and never came back down.” CAS also recorded a year-on-year increase of 25.92 percent for new rent prices in April. “In Ashrafieh, an apartment used to cost around $600. Now, it’s around $1,000.”
Between private generator and state electricity bills, Joyce is paying a combined total of at least $250 a month for 20 amperes in Jbeil. “Last year, we paid closer to $200. That’s at least 25 percent less.”
The second explanation, according to Hamdan, is a deeper structural issue surrounding the oligopolistic nature of Lebanon’s consumer markets. “A study we conducted in 2003 showed that in two-thirds of Lebanon’s markets, three companies controlled 70 percent of the market share. That reality still holds today,” he said.
He adds that while several antitrust laws to fight monopolies have been passed over the past two decades, their enforcement remains ineffective. “We live under an extremely liberal economic system — so liberal, in fact, that even the basic rules of economic liberalism are not respected in Lebanon.”
Low purchasing power
For Nagi Morkos, managing partner at Hodema Consulting Services, the rise in restaurant and bar prices is less about new increases and more about a return to pre-crisis levels. “The real issue is that while prices have surged, wages — which were severely eroded during the crisis — have not kept pace. People’s purchasing power today is lower than it was before.”
Even the minimum wage, which stood at around LL675,000 (or $450 at the LL1,500 to the dollar rate), never regained its pre-crisis level. Fixed at LL18 million today, plans to potentially increase it to LL28 million ($312) are pending Cabinet approval.
“People feel prices are higher because they’re comparing them to three years ago,” he said. “For those earning in fresh dollars — or foreign currency not subject to banking restrictions — during that period, everything seemed cheaper by comparison.”
“Even the modest price increases seen in restaurants can be linked back to the early crisis years,” Morkos explained. With imported goods either unavailable or too costly, many turned to cheaper local substitutes and scaled back on luxury offerings like lobster, for example. “Today, however, high-end items are being gradually reintroduced to menus.”
Yet numbers from the CAS published in April show that food and non-alcoholic beverages went up by 20.87 percent yearly, while restaurant and hotel prices climbed 14.88 percent over the same period.
Given Lebanon’s heavy reliance on imports, Morkos noted that global inflation and higher import taxes may have driven prices up locally.
A similar observation was echoed by Hani Bohsali, president of Lebanon’s food importers syndicate, who claims he has not seen any drastic changes in prices so far. He pointed out, however, that the euro has strengthened by 10 percent over the past two months, making European imports automatically more expensive.
This appreciation of the euro comes as the U.S. dollar weakened against major currencies, following sweeping tariffs announced by U.S. President Donald Trump and the ensuing global economic uncertainty.
In 2024, Lebanon’s imports from the European Union totaled $5.32 billion, according to numbers from the United Nations COMTRADE.
“Lebanon has long been a country with a high cost of living,” Bohsali also stressed.
*Names have been changed at the request of the interviewees.
