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Beirut Rapid Damage and Needs Assessment (English)

On August 4, 2020, a massive explosion rocked the Port of Beirut (PoB), destroying much ofthe port and severely damaging dense residential and commercial areas within five kilometersof the site of the explosion. The disaster left more than 200 people dead, thousands injured, andmany homeless. Shocking pictures and videos from the Lebanese capital were shared widely acrossthe planet, showing a city in ruins and the suffering of those affected. Beyond the human tragedy, the economic impact of the explosion is notable at the national level despite the geographic concentration of the destruction. This reflects: (i) the demographic clustering of the Lebanese population in Beirut and its suburbs; (ii) the prominence of economic activity in the affected areas, especially in regard to commerce, real estate and tourism; and (iii) the fact that the PoB is the main point of entry/exit for the small open economy, channeling 68 percent (2011-2018 average) of the country’s total external trade. Even prior to the explosion, Lebanon was already reeling from multiple crises since 2011. These included: (i) spillovers from the conflict in Syria, which led Lebanon to host the largest refugee per capita population in the world; (ii) a financial and economic crisis that has induced systemic macrofinancial failures, including, impairment of the banking sector and risk of deposits; an exchange rate collapse; a default on sovereign debt; triple digit inflation rates; and a severe economic contraction; and (iii) impacts from the COVID-19 pandemic; Lebanon, not unlike other countries, responded with lockdowns that further exacerbated economic and financial stresses. The above add to long-term structural vulnerabilities that include low-grade infrastructure—a dysfunctional electricity sector, water supply shortages, inadequate solid waste and wastewater management—public financial mismanagement, large macroeconomic imbalances, and deteriorating social indicators. These vulnerabilities are taking place against the backdrop of high levels of corruption, political turmoil, and weak governance. Internationally, Lebanon was sub-optimally integrated into the global economy and global value chains, and the sizeable and persistent migration of highly educated human resources to foreign labor markets (brain drain) further contributed to poor productivity. As a result, the economy has struggled to reduce poverty and to generate inclusive growth, with job creation remaining weak and poorly distributed even during periods of high GDP growth. The long-run employment-growth elasticity is estimated to be 0.2,2 much lower than an estimated MENA average of 0.5.3 Meanwhile, the generated employment has been concentrated in low productivity activities as those involving higher productivity have not grown proportionally. Since foreign labor dominated low skilled (less productive) activities, high GDP growth rates have not translated into significant job creation for the Lebanese.


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    Middle East and North Africa,

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    Beirut Rapid Damage and Needs Assessment

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    Damage and Needs Assessment; disaster risk management; long-run employment; infrastructure and service delivery; foreign direct investment; fixed exchange rate regime; Public and Private Institution; Fragility, Conflict, and Violence; disability-adjusted life; ngos and civil society; Institutional Strengthening for Environmental; monitoring and evaluation arrangement; capital investment plan; physical asset; principle of transparency; point of entry; international development assistance; gross public debt; macroeconomic impact; senior operations; provision of service; current account deficit; international community; primary health care; world food programme; extreme poverty rates; external affairs; foreign labor markets; global value chain; inadequate solid waste; water supply shortage; source of financing; assessment of damages; source of inflow; cost of debt; short-term capital inflows; monetary policy framework; financial sector restructuring; exchange rate crisis; financial sector assessment; data limitation; local government authority; reduction of poverty; high poverty rate; civil society stakeholders; allocation of resource; conflict and violence; social protection system; transparent public procurement; lack of accountability; Electricity Sector Reform; public procurement law; international financial institution; access to job; sense of hopelessness; dynamics of conflict; infrastructure sector; physical infrastructure; real gdp; replacement value; stakeholder engagement; assessment result; non-governmental organization; infrastructure reconstruction; Real estate; external trade; credible reform; citizen engagement; external imbalance; recovery process; reconstruction activities; enhanced transparency; Job Creation; economic vulnerability; investment climate; youth group; culture sector; in poverty; market vendor; Exchange Rates; banking sector; economic crisis; open economy; recovery effort; transaction cost; commercial areas; collected data; high resolution; satellite imagery; good governance; physical damage; systemic failure; fiscal revenue; trade disruption; strategic objective; improving governance; sectoral reform; negligible amount; affected population; housing sector; Macroeconomic Stability; vulnerable group; rehabilitation process; think tank; full transparency; special provision; transparent manner; promote citizen; fault line; social cohesion; political turmoil; global economy; Economic Policy; crisis recovery; social crisis; donor coordination; national economy; several options; inflation rate; social change; short-term investments; financial stress; subsidiary right; productive investment; consensus building; vulnerable segment; accountability framework; sovereign debt; wastewater management; financial mismanagement; economic migrant; social indicator; macroeconomic condition; binding constraint; low capital; financial engineering; common vision; competitive market; fiscal space; macroeconomic stabilization; humanitarian assistance; fiscal institution; governance reform; health outcome; human security; new information; public resource; competition framework; concessional financing; patronage system; donor pledge; Brain Drain; donor grant; international partners; inclusive growth; social inclusion; financing facility; photo credit; finance strategy; private capital; concessional loan; Boosting Growth; grant financing; remote data; legal mandate; sovereign default; government default; Tax Exemption; geographical concentration; tourism sector; industry sector; data gaps; reasonable assumption; security situation; national emergency; urban development; rapid assessment; sector analysis; societal systems; reduction measure; foreign exchange; Public Services; financial account; economic reform; trade deficit; fiscal deficit; domestic revenue; foreign currency; high ratio; refinancing risk; international expert; local public; lebanese pound; bank deposit; fiscal policy; Fiscal policies; fiscal adjustment



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Beirut Rapid Damage and Needs Assessment (English). Washington, D.C. : World Bank Group.