More than a year of conflict between Israel and Hezbollah has caused severe economic and physical damage to Lebanon, with losses exceeding $8.5 billion, according to a new report by the World Bank.Â
The report estimates $3.4 billion in physical damages, primarily to housing, agriculture, and commercial sectors, and $5.1 billion in economic losses. Nearly 100,000 housing units, particularly in southern Lebanon, have been partially or fully destroyed, with damages to the housing sector alone reaching $2.8 billion. Agricultural losses, including damage to crops and livestock, amount to $1.2 billion, while disruptions to commerce and tourism add close to $2 billion.
These losses have led to a steep decline in Lebanon’s economic growth, with real GDP for 2024 estimated to have contracted by at least 6.6%. The cumulative effect compounds Lebanon’s ongoing economic crisis, which has seen a 34% GDP decline over the past five years.
The conflict has displaced over 875,000 people within Lebanon, with women, children, the elderly, and refugees being the most vulnerable. Additionally, approximately 166,000 individuals have lost their jobs, resulting in $168 million in lost earnings. The ongoing violence has exacerbated poverty levels, with Lebanon already grappling with one of the worst economic crises in its history.
The report covers the period between October 8, 2023, and October 27, 2024, during which Hezbollah launched attacks on Israeli border communities in response to Israeli military operations and a broader conflict involving Gaza.
According to the United Nations Development Program, Lebanon’s GDP is projected to shrink by 2.28% in 2025 and 2.43% in 2026, with long-term consequences for national wealth and infrastructure. The World Bank warns that the final cost of damages and economic losses could significantly exceed current estimates.
The World Bank is activating emergency plans to redirect resources toward urgent humanitarian needs in Lebanon. A more comprehensive Rapid Damage and Needs Assessment evaluating the full extent of damages and recovery costs, will be conducted when conditions permit.
