Opinion: Lebanon and the Gulf

In a notable article, former Lebanese Prime Minister Fouad Siniora mentioned that he had received repeated calls from his friends in the Gulf Arab countries, including businessmen, who expressed their dissatisfaction with the difficulties and problems facing investors in their business activities in Lebanon. He also noted that they suffer from the loss of their rights.

There is no doubt that the economic situation in Lebanon is not ideal, and the continued presence of Iranian influence, represented by Hezbollah and its weapons, constitutes a real risk to any natural investment in the country. Lebanon has also suffered from the loss of depositors' rights in banks, which included low-income Lebanese depositors, as well as Lebanese, Gulf, and other businessmen. The economic environment cannot be attractive if depositors' rights are lost and they are no longer allowed to withdraw from their deposits.

These conditions have led to a decline in direct investment flows, leaving only remittances from expatriates to their families. According to estimates by the Central Bank of Lebanon, expatriate remittances in 2025 ranged between $6.2 and $6.7 billion. The disruption of export activities and the decline in tourism revenues have reduced the country's ability to meet its external obligations, whether for import bill payments or servicing external debt.

The Lebanese pound exchange rate remained around 1,500 pounds per US dollar since the end of the civil war in 1995, but the current exchange rate has reached approximately 89,500 pounds per dollar. It is well known that the Lebanese pound exchange rate has deteriorated in recent years due to the economic difficulties the country has faced and the ongoing political and security collapse. The current exchange rate is susceptible to further decline unless a miracle occurs and political and economic conditions improve. There is also a black market for trading the US dollar, where the price reaches approximately 143,000 Lebanese pounds per dollar.

The Central Bank of Lebanon remains poor in its capabilities and monetary tools to establish a stable exchange rate. It appears that many investors take into account the risk of currency depreciation when considering any investment there. What Gulf and other investors seek is a stable and promising business environment that provides laws, regulations, and traditions that protect the rights of investors and Lebanese citizens themselves. Given these realities, can the country overcome the living problems and lack of job opportunities for citizens, especially young people and university and institute graduates who seek to earn a living in their own country?

Gulf countries have remained the most important providers of support to the Lebanese economy since the beginning of the 1950s, whether through private investments, direct aid, or concessional loans from their development funds. During the reconstruction phase in the 1990s and beyond, these countries provided billions of dollars, and banking sources recall that Saudi Arabia provided over $70 billion between 1990 and 2015, whether directly or indirectly.

These countries have continued to participate in Lebanon support conferences over the past years and decades. This support must find a suitable environment that contributes to channeling funds into appropriate avenues and viable projects. It goes without saying that despite the political changes in Lebanon since the beginning of 2025 and the potential to address security and political conditions, the country still oscillates between war and peace, and matters must be resolved to attract investors.

Lebanese workers in the Gulf countries hold significant economic importance for Lebanon. The number of Lebanese in the Gulf is estimated at around half a million, with 300,000 in Saudi Arabia and 150,000 in the United Arab Emirates, while the remainder are distributed among other Gulf states. Lebanese remittances to Lebanon account for between 40% and 50% of the total $6.9 billion sent in 2025, amounting to approximately $3.5 billion. Although these remittances may have declined during the current year, they remain crucial to the Lebanese economy amid the challenging conditions it faces.