Lebanon’s ongoing economic crisis represents a huge market challenge.  Insolvent banks have banned most overseas transfers, meaning that U.S. and other international firms can only transfer overseas funds from “fresh dollar accounts” (i.e. accounts opened after October 2019 with cash deposits or deposits transferred from abroad).  Many U.S. companies have complained about millions of dollars’ worth of deposits stuck in pre-October 2019 accounts.  At the same time, volatility and depreciation in the Lebanese pound from late 2019 through early 2023 led Lebanon’s private sector to largely dollarize.  Most public sector workers are still paid in local currency, however, and they are demanding salary increases to keep pace with rising inflation, and many are only showing up for a portion of the work week.  Some essential public sector services – such as registering new home ownership – are either unavailable or significantly delayed.  A growing number of Lebanese have felt compelled to emigrate in search of a better life.  According to the United Nations, the country’s income poverty rate increased from 25 percent in 2019 to 74 percent in 2021.

Corruption and a lack of transparency have continued to cause frustration among local and foreign businesses.  According to Transparency International’s 2022 Corruption Perception Index (CPI), Lebanon ranked 150 of 180 countries worldwide.  Foreign and local companies have complained about numerous impediments, namely institutionalized corruption, bureaucratic over-regulation, arbitrary licensing, complex customs procedures, outdated legislation, an ineffectual judicial system, poor telecommunication services, slow internet speeds, poor electricity provision, inconsistent interpretation of laws, and inadequate protection of intellectual property. 

Lebanon adheres to the Arab League Boycott of Israel.  The Arab League’s Central Boycott Office maintains a blacklist of firms that are believed to contribute to Israel’s military or economic development.  As of March 2024, the U.S. Embassy in Beirut is not aware of any U.S. firms seeking to bid on contracts in Lebanon that are excluded based on the boycott.  As per U.S anti-boycott regulations, U.S. companies must refrain from certifying that their products do not come from Israel.  If there appear to be any request that might be in support of boycotts, companies should contact the Bureau of Industrial Security (BIS) at the U.S. Department of Commerce.  Finally, international companies should be mindful about sanctioned individuals and entities when conducting business in Lebanon.