Lebanon’s economy is projected to shrink by 6.4 percent this year as conflict turns a brief post-crisis recovery into a sharp downturn, says the World Bank. The global lender’s Summer 2026 Lebanon Economic Monitor, titled A Conflict-Torn Economy, noted that the country entered the year on stronger footing after expanding by 4.2 percent in 2025, its highest real gross domestic product (GDP) growth since the 2019 financial collapse. Consumer prices are also under renewed pressure, with inflation expected to accelerate to 17.5 percent.
The World Bank attributed the rise to supply disruptions, elevated shipping costs, and volatile fuel prices. Parliament recently passed key amendments to the bank resolution law, designed to restructure failing financial institutions and map out a framework for the broader financial sector crisis. The International Monetary Fund (IMF) endorsed the legislative progress, calling the measure “a very good step that reflects Lebanon’s commitment to aligning its legislation with the best international practices”.
The IMF, which has maintained ongoing discussions with Lebanese officials to secure a formal bailout program, confirmed it plans to resume technical meetings in Beirut next month to evaluate further structural policy measures.
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