Saturday 30 May 2020 | 07:17 | SYDNEY
Saturday 30 May 2020 | 07:17 | SYDNEY

When the Gulf sneezes, Lebanon catches a cold


Rodger Shanahan


20 January 2009 08:52

What keeps the Lebanese economy afloat has often been a point of contention. But with the Lebanese penchant for hard work, business acumen and a number of highly regarded universities, its export of business and professional labour has long been a key source of income. Indeed, Lebanon received an estimated $6 billion in remittances in 2008, or nearly a quarter of its GDP. Of this, 45 per cent came from the booming Gulf economies, where well qualified bi- and tri-lingual Lebanese were in high demand.
The impact of the global financial crisis on this income stream is yet to be fully felt, but as the Finance Minister stated in December, when an estimated one-third of your workforce is employed in the GCC, the flow-on effects of a downturn in the Gulf economies will be quickly felt in Lebanon. Despite the fact that the Lebanese economy is in very good shape, it is nowhere near large enough to absorb a significant number of returning workers, so many would be forced to other countries to find work.
With elections due in May, the fear is that political uncertainty allied with fallout from weaker GCC economies may undo much of the good economic work done since the 2006 war with Israel. In Lebanon, nobody is ever confident about predicting the future of anything. But what is certain is that, whatever the makeup of the new government, it will need to have technocrats rather than partisan political operatives in charge of the treasury for Lebanon to ride out the economic storm.