Lebanon’s Export Sector – A Revealed Comparative Advantage Study

Abstract

This research paper studies the structural changes in Lebanon's export sector that occurred as a result of the financial-economic crisis. The revealed comparative advantage index is used to calculate the relative advantage or disadvantage of Lebanon’s exports as evidenced by trade flows.

The results show that the crisis had a significant impact on the export sector, leading to a shift in the structure of exports towards less diversified and more basic exports that have little to no added value. The revealed comparative advantage index revealed that the competitiveness of Lebanese exports decreased during the crisis, and shifted towards more agricultural-based exports.

The study concludes that the Lebanese government should implement policies to support the development of new export sectors and to improve the competitiveness of traditional sectors in order to revive the export sector and promote economic growth. The government should also tackle the electricity issue in order to bring back the competitiveness of complex goods.