Hezbollah-Israel Conflict Threatens Lebanon’s Fragile Economy, Report Says

Smoke rises following an Israeli air strike on Khiam in southern Lebanon on October 29, 2024. (AFP)
Smoke rises following an Israeli air strike on Khiam in southern Lebanon on October 29, 2024. (AFP)
TT

Hezbollah-Israel Conflict Threatens Lebanon’s Fragile Economy, Report Says

Smoke rises following an Israeli air strike on Khiam in southern Lebanon on October 29, 2024. (AFP)
Smoke rises following an Israeli air strike on Khiam in southern Lebanon on October 29, 2024. (AFP)

Analysis from a humanitarian group working in Lebanon forecasts two scenarios in its report on the Hezbollah-Israel conflict, both predicting a severe economic contraction in Lebanon by early 2025.

Mercy Corps’ Lebanon Crisis Analysis Team says Israel’s continued strikes on suspected Hezbollah targets in Lebanon, without blocking key infrastructure, will still bring severe economic and humanitarian risks.

Lebanon’s economy could contract by 12.81%, or $2.305 billion by January 2025, with impacts hitting agriculture, manufacturing, and services hard in the South and Bekaa Valley.

Agriculture in South Lebanon, which drives 80% of its economy, may come to a halt, while factories face shutdowns, the report says. “The Bekaa Valley, responsible for 2% of national GDP, will see similar disruptions, with 70% of farmland under threat and many Syrian laborers fleeing,” it adds.

The service sector, particularly tourism, stands to lose $1.256 billion, potentially crippling a vital part of the economy.

If Israel imposes a stricter blockade and expands bombings to key infrastructure, Lebanon’s economic loss could rise to 21.9% of GDP, or $3.938 billion, according to the report.

Over 1.5 million people could be displaced, with political and intercommunal tensions intensifying as Shiites flee to diverse religious regions that are majority Christian, Druze or Sunni, the report adds.

Already, 1.2 million people have been displaced from villages in southern and eastern Lebanon as well as Beirut’s southern suburbs.

Lebanon, already enduring a five-year economic crisis marked by a severe currency collapse, had just begun showing signs of recovery before the war erupted.



Aramco, Riyadh Air Explore Collaboration Opportunities

At the signing ceremony standing, from left, are Osamah Alnuaiser, Riyadh Air SVP of Marketing & Corporate Communication; Tony Douglas, Riyadh Air CEO; Amin H. Nasser, Aramco President & CEO; and Mohammed Y. Al Qahtani, Aramco Downstream President. Sitting, from left, are Adam Boukadida, Riyadh Air CFO; and Yasser M. Mufti, Aramco EVP of Products & Customers. Photo: Aramco
At the signing ceremony standing, from left, are Osamah Alnuaiser, Riyadh Air SVP of Marketing & Corporate Communication; Tony Douglas, Riyadh Air CEO; Amin H. Nasser, Aramco President & CEO; and Mohammed Y. Al Qahtani, Aramco Downstream President. Sitting, from left, are Adam Boukadida, Riyadh Air CFO; and Yasser M. Mufti, Aramco EVP of Products & Customers. Photo: Aramco
TT

Aramco, Riyadh Air Explore Collaboration Opportunities

At the signing ceremony standing, from left, are Osamah Alnuaiser, Riyadh Air SVP of Marketing & Corporate Communication; Tony Douglas, Riyadh Air CEO; Amin H. Nasser, Aramco President & CEO; and Mohammed Y. Al Qahtani, Aramco Downstream President. Sitting, from left, are Adam Boukadida, Riyadh Air CFO; and Yasser M. Mufti, Aramco EVP of Products & Customers. Photo: Aramco
At the signing ceremony standing, from left, are Osamah Alnuaiser, Riyadh Air SVP of Marketing & Corporate Communication; Tony Douglas, Riyadh Air CEO; Amin H. Nasser, Aramco President & CEO; and Mohammed Y. Al Qahtani, Aramco Downstream President. Sitting, from left, are Adam Boukadida, Riyadh Air CFO; and Yasser M. Mufti, Aramco EVP of Products & Customers. Photo: Aramco

Saudi Aramco and Riyadh Air, the Kingdom's new premium international airline, have signed a Memorandum of Understanding (MoU) during the FII 8th Edition in Riyadh.

The MoU sets the stage for potential collaboration in areas such as low-carbon fuel supply and sustainability.

“We are delighted by the prospect of exploring a wide variety of opportunities for collaboration between Aramco and Riyadh Air,” said Aramco Executive Vice President of Products & Customers Yasser M. Mufti.

“Both companies have expressed a desire to adopt latest technologies, elevate experiences and contribute to sustainability objectives. Aramco’s work to develop lower-carbon fuels, its strong focus on digitalization, and its aviation experience, among other things, provide a strong platform for potential cooperation with Riyadh Air,” he added.

As for Riyadh Air Chief Financial officer Adam Boukadida, he said that the partnership “aligns perfectly with our ambition to become a leading global airline committed to sustainability and low-carbon fuels.”

“By leveraging Aramco’s expertise, we aim to improve our operational capabilities and provide outstanding experiences for our guests. Together, we can play a significant role in advancing the Kingdom’s environmental and economic objectives.”