A June 2021 World Bank report estimated that Lebanon’s economic depression is likely to rank among the world’s top three most severe economic crises since the 1850s, noting that the “brutal and rapid” contraction in Lebanon’s GDP was of a magnitude usually affiliated with conflicts or wars. Throughout 2024, Lebanon continued to face depressed economic activity stemming from the onset of the economic crisis in late 2019. Additionally, following the October 7, 2023, Hamas terrorist attack in Israel, U.S.-designated terrorist group Hizballah initiated cross-border fire with Israel along Lebanon’s southern border on October 8, leading to an armed conflict between Hizballah and Israel that continued until a cessation of hostilities agreement was announced on November 27, 2024. While these hostilities remained largely contained to Lebanon’s southern border areas, the instability and risk of escalation presented further obstacles for Lebanon’s economic recovery.

The World Bank estimated Lebanon’s real GDP fell 7.1 percent in 2024, adding to a 2019-2024 cumulative contraction of more than 40 percent.  The Lebanese pound (LBP) stabilized in 2024 after losing more than 98 percent of its value since 2019, and inflation fell to 45.2 percent from 231.3 percent in 2023. Since October 2019, Lebanon’s financial sector has imposed ad hoc capital controls, limiting withdrawals from pre-October 2019 bank accounts. In 2020, Lebanon defaulted on its nearly $31 billion in dollar-denominated debt, the first such default in Lebanon’s history.  Lebanon and the IMF reached a staff-level agreement on Lebanon’s proposed economic reforms in April 2022, in which the Lebanese government committed to eight prior actions before the IMF’s Executive Board would consider financing a $3 billion, four-year loan. However, as of March 2025, the government had made only limited progress on these prior actions.  The primary obstacle to undertaking these and other much-needed reforms remains persistent political paralysis.  The election of President Joseph Aoun in January 2025 ended a more than two-year vacancy in Lebanon’s presidency, during which time the country’s Premiership and Cabinet remained in caretaker status with reduced authorities per the country’s constitution, creating a “double vacancy” for the first time in Lebanon’s history.  Even before this double vacancy, Lebanon’s politicians did not pursue reforms at a speed commensurate to the severity of the country’s economic crisis.

While the overall economic picture is bleak, there are sources of optimism and U.S. firms may still find commercial opportunities in Lebanon. In its Spring 2025 Lebanon Economic Monitor, the World Bank projected 4.7 percent growth in real GDP with inflation moderating to 15.2 percent, “supported by anticipated reform progress, a recovery in tourism and consumption, limited capital inflows, and a base effect.” However, continued economic growth remains highly sensitive to continued progress on economic reforms and security to move the country away from its heavy reliance on tourism and remittance inflows which are neither a viable economic strategy nor an economic crisis resolution plan.  U.S. products and services enjoy relatively excellent receptivity in Lebanon. Although the market is price-sensitive, when it comes to quality, Lebanese consumers enjoy name brands, exceptional quality, and after-sales support.  In the longer term, Lebanon benefits from a highly educated labor force, diverse culture, rich history, strong tourism appeal, and temperate Mediterranean climate. The Lebanese diaspora community has provided a backstop to Lebanon’s economic woes through a steady flow of remittances and could be the country’s vanguard of renewed investment if conditions improve, which may result in increased commercial opportunities for U.S. companies.

Lebanese Customs reported that Lebanon’s total imports in 2024 reached $17.3 billion, of which $584 million (3.37 percent) originated in the United States. The United States was Lebanon’s ninth largest import partner, after China, Greece, Switzerland, Egypt, Turkey, United Arab Emirates, Italy, and Saudi Arabia. According to Lebanese Customs statistics, major U.S. exports to Lebanon were automotive products ($130 million), chemical industrial products ($111 million), machinery ($86 million), vegetable products ($60 million), prepared foodstuffs, beverages, and tobacco ($46 million), and optical photographic medical instruments ($41 million).

The U.S. government has neither a bilateral investment treaty (BIT) with Lebanon, nor an agreement on the avoidance of double-taxation. The U.S. government signed a Trade and Investment Framework Agreement (TIFA) with Lebanon in 2006, but the TIFA never came into force. Since 1999, Lebanon has had observer status at the World Trade Organization (WTO) but has yet to accede to the organization. In 2002, Lebanon signed an association agreement with the European Union that entered into force in 2006.

Visit State Department’s website for background on the country’s political and economic environment.