Attachments
Highlights
• The economic outlook for 2020 reveals a severe contraction in GDP by 13.9 percent together with an alarming indebtedness level (forecasted at 168 percent of GDP) and further widening of fiscal deficit.
• Forecasts for 2021 confirm the persistence of the economic crisis as GDP is seen to contract by 2.4 percent, public debt to be 160 percent of GDP and fiscal balance to be -10.6 of GDP.
• The explosion on August 4th destroyed the port of Beirut, the country’s main entry point for goods imported via sea – covering 80 percent of Lebanon’s maritime shipping traffic. WFP-contracted shops in the surroundings of the port of Beirut were not severely affected, as they are mostly located in the areas that were only partially damaged by the explosion.
• Spiralling food inflation rates combined with strong currency depreciation and displacement of nearly 300,000 inhabitants are main risk factors affecting the purchasing power of households.
• Markets or grocery stores remain the main source of food for most Lebanese households (more than 94 percent), even in the aftermath of the explosion
• The effects of the explosion at the port of Beirut on the Lebanese economy and supply chains are seen to worsen an already deteriorating socio-economic situation, which is likely to result into a further increase in the number of the poor and extreme poor (45 percent of the population according to the World Bank).
• Taking into account poverty estimates, the deteriorating macroeconomic situation, spiralling inflation and reduced capability of households to stockpile, WFP estimates immediate cash assistance is needed for approximately 150,000 of the 300,000 people estimated to be directly affected by the explosion, including displaced children, women, older persons in urgent need for shelter food and other basic needs
• Due to the volatility of the currency and high inflation rates, constant food security and price monitoring needs to continue to ensure that necessary programmatic changes (e.g. transfer value adjustments) are immediately implemented.