On the Way Out of Lebanon’s Triple Crisis

Abstract

Six years into the crisis, with national income now at half its potential, it is long past time to implement the decisive reforms needed to unshackle the economy and allow it to grow again. This is no easy matter as the crisis concerns the interlinked problems of restructuring the banking sector, the public debt, and the currency. Lebanon Inc. has few assets and lots of liabilities, but until its balance sheets are cleaned up, its economy will remain stuck in a low equilibrium. Moreover, it risks missing out on the opportunities of participating in the rebuilding of Lebanon, Syria, and even Palestine.