Lebanon's economic performance was sluggish in 2013 due to continuing regional turmoil in Iraq and Syria. The effect of these conflicts on Lebanon's economy has been a degradation of tourism, investment and foreign trade. Despite these problems, Lebanon's economy grew at a rate of 1.5% to 2.5%. Lebanon's imports stagnated and exports declined 12%, increasing its foreign trade deficit by 3%. Lebanon's total trade deficit was $17.3 billion in 2013, or 39.8% of GDP. Lebanon's cumulative deficit was $1.1 billion in 2013, a bit lower than the previous year. The economy is buoyed mainly by private consumption as investment shrinks. Lebanon will likely slightly improve from its low base in 2014, or at least stabilize. Banks in Lebanon reported growing deposits in 2014 and new private sector bank loans of $3.5 billion suggesting the economy will continue to be weak, but could move in a positive direction in 2014. However, deficit and debt ratios will continue to worsen as the fiscal debt is expected to reach 10.9% of GDP in 2014, a debt/GDP ratio of 147.9% by the end of 2014. If the short and medium term are clouded by continuing strife along its borders, huge inflows of refugees and internal political instability, Lebanon's longer term prospects appear favorable as it sits upon reserves of 865 million barrels oil and 96 trillion cubic feet of gas, net proceeds of $600 billion.
Lebanon's sectors have been impacted by its neighbors wars. Most of those impacts are detrimental, sapping growth, but there are also examples of Lebanon's sectors filling the breach. Lebanon's agricultural sector is an example of an economic space that has benefited from its neighbors unrest as Lebanon fulfills demand left unmet by Syria, Jordan and Iraq. Agriculture grew at 5.8% in 2013 compared to 1.9% in 2012 and helped to drive a 40% increase in sea freight in 2013. Industrial exports also improved by 6.4% during the first 11 months of 2013 after a decline of 11.7% in the same period in 2012. Regional tensions clearly hurt Lebanon's property sector, however, which saw the number of sales transactions decline by 7.2% and their value decline by 2.4% to $8.7 billion. Construction permits declined by 10.9%. Maritime revenues increased to $219.1 million or by 25.4% in 2013 with most of that increase is due to trade diverted by conflict. Tourism, however, has been badly affected by regional tensions with the number of visitors declining 6.7% in 2013 after declining a total of 31.3% in the two years prior. This reflects uncertainty about the region as a whole but also the destruction of Syria's tourism economy, which used Lebanon as a hub. Despite the poor showing of the tourism industry, air travel to Lebanon rose 5.7% in 2013 after similar growth in 2012.
Lebanon overall Doing Business ranking (111 out of 189 countries) dropped by six places in 2014 compared to 2013. Lebanon's rankings dropped slightly in all but one measure, trading across borders (97) improving by one place. Lebanon's lowest rankings included dealing with construction permits (179), enforcing contracts (126) and starting a business (120). Lebanon's highest rankings include paying taxes (39) and getting electricity (51). Lebanon's trading across borders ranking (97) improved by one place.