Egypt, Lebanon, Jordan, the war weakens the economy of Israel’s tourist neighbors

By Clara Galtier

Published ,

The old market, deserted by tourists, in the ancient city of Byblos, November 10, Lebanon. JOSEPH EID/AFP

The three countries with already very weakened finances have suffered a decline in attendance since October 7.

There war in Israel constitutes a new economic shock for its three neighbors, Egypt, Jordan and Lebanon. Very weakened since the pandemic, severely exposed to rising interest rates, these economies suffer from structural problems of external deficit and debt. Jordan’s debt, weighing 94% of GDP, threatens to spiral out of control at any time. Cash-strapped Egypt is negotiating hard with the IMF for the disburt of $700 million in aid tranches and a potential increase to the ongoing $3 billion aid program before December elections. THE Lebanon is stuck in an endless crisis, between hyperinflation, the collapse of its currency and failing authorities. The country has not restructured its debt since the default announced in April 2020.

In this already degraded context, “ the Gaza war is a new blow», Supports Alia Moubayed, economist at Jefferies bank. With a first immediate and obvious impact on tourism…

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