Lebanon War Costs Exceed $27 Billion Amidst Widespread Destruction
Translated & summarized from i24NEWS Arabic by baba
Lebanon's war-related economic and material losses have exceeded $27 billion, with approximately 132,000 homes destroyed or needing demolition. Israeli military operations in southern Lebanon have also severely impacted the agricultural sector, damaging over 22.5% of farmlands. The Lebanese economy is projected to contract by 6.2% this year, with tourism and trade deficits worsening. Experts warn that these losses jeopardize future growth and investment, presenting Lebanon with a dual challenge of reconstruction and economic stabilization.
The story in 6 lines · by baba
- Lebanon's war losses exceed $27 billion, with 132,000 homes destroyed or requiring demolition.
- Over 22.5% of Lebanon's agricultural land, exceeding 56,000 hectares, has been damaged.
- The Lebanese economy is projected to contract by 6.2% this year, falling below $30 billion GDP.
- Tourism has declined by 26% in 2026, impacting hotels and potentially leading to closures.
- Around 65 southern villages remain under Israeli military control, hindering resident returns.
- The balance of payments deficit is estimated between $2 to $3 billion, and the trade deficit is $9 to $10 billion.
Economic and material losses from the conflict in Lebanon have surpassed an initial estimate of $27 billion, as Israeli military operations continue in the south, involving the destruction of buildings, leveling of neighborhoods, and targeting of agricultural lands and infrastructure. These estimates cover damages incurred since October 8, 2023, and the renewed fighting that began on March 2, 2026, following Hezbollah rocket fire on Israeli military sites. This escalation occurred despite an armistice agreement signed in Washington on June 26, and an earlier ceasefire that took effect on November 27, 2024.
Approximately 132,000 homes are destroyed or require complete demolition, with an additional 47,000 sustaining partial damage. Observers note that around 65 southern villages and towns remain under Israeli military control, hindering residents' return. The agricultural sector has also suffered extensively, with over 22.5% of farmland, exceeding 56,000 hectares, damaged. The Lebanese Minister of Agriculture, Nizar Hani, reported in September that olive, banana, and citrus trees were among the most affected. Israeli military control over border areas prevents farmers from accessing their land, increasing losses even in undamaged regions.
Economists warn of indirect losses extending for years, as Lebanon misses growth and investment opportunities. The Lebanese economy, which projected 5% to 7% growth in 2026 and a GDP between $31.7 and $32 billion at the start of 2025, is now estimated to contract by 6.2% this year, with GDP falling below $30 billion. This downturn may negatively impact international financial institutions' confidence in Lebanon's recovery and ability to meet its obligations.
Further economic damage includes a worsening balance of payments, which shifted from surpluses to an estimated deficit of $2 to $3 billion in July and August. The trade deficit has also widened to approximately $9 to $10 billion in the first eight months of the year, driven by increased import costs and decreased exports. Tourism has declined by 26% in 2026, primarily affecting hotels and tourist establishments, some of which are considering closure.
These cumulative losses, extending beyond direct material damage to growth prospects, income sources, and investments, are expected to rise as Israeli operations and restrictions on returning residents continue. Lebanon faces the dual challenge of reconstruction and containing its deepening economic crisis.