IMF concerned about the effect of Lebanon’s falling GDP growth on its debt pile.
Lebanon has not taken the necessary measures to reduce its debt following the drop in its economic growth in 2011, according to Nemat Shafik, the deputy managing director of Washington-headquartered IMF.
“Infrastructure and investments are long overdue, as are reforms in the business environment,” said Shafik during a visit to Lebanon on 9 May.
The collapse of Lebanon’s 14-month old unity government in January 2011 and the political unrest in Syria have had a negative impact on the country’s economy. As a result of the uncertainty, Lebanon’s gross domestic product (GDP) growth fell from 7 per cent in 2010 to 1.5 per cent last year.
The IMF is concerned about the effect of Lebanon’s falling GDP growth on its debt pile. Lebanon has one of the highest debt levels in the world, with total government gross debt in 2010 equivalent to 134.1 per cent of its GDP.