Beirut Rapid Damage and Needs Assessment
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 peop...
| Main Authors: | , , |
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| Format: | Report |
| Language: | English |
| Published: |
World Bank, Washington, DC
2020
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/191691598832635302/Beirut-Rapid-Damage-and-Needs-Assessment http://hdl.handle.net/10986/34401 |
| Summary: | 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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