Template-Type: ReDIF-Paper 1.0 Author-Name: Ricardo Hausmann Author-Email: ricardo_hausmann@harvard.edu Author-Workplace-Name: Harvard's Growth Lab Author-Person: pha552 Author-Name: Ugo Panizza Author-Person: ppa92 Author-Name: Carmen Reinhart Author-Workplace-Name: Center for International Development at Harvard University Author-Person: pre33 Author-Name: Douglas Barrios Author-Email: douglas_barrios@hks.harvard.edu Author-Workplace-Name: Center for International Development at Harvard University Author-Name: Clement Brenot Author-Workplace-Name: Center for International Development at Harvard University Author-Name: Jesus Daboin Pacheco Author-Name: Clemens Graf von Luckner Author-Name: Frank Muci Author-Workplace-Name: Center for International Development at Harvard University Author-Name: Lucila Venturi Title: Towards a Sustainable Recovery for Lebanon's Economy Abstract: Lebanon’s current economic crisis ranks among the worst in recent history. GDP has collapsed by 38% in real terms. The Lebanese lira, which was fixed to the dollar in 1997, has lost more than 98% of its value on the parallel market. The government has defaulted on its debt, and depositors are unable to access their funds held at commercial banks. Consolidated public sector debt, including both government debt and commercial banks’ claims on the Banque du Liban (BdL), represents more than seven times the current GDP. Public services delivery has crumbled. In short, the country is undergoing a debt crisis, a banking crisis, a currency crisis, and a growth collapse. Four years into the crisis, a resolution remains elusive, and each passing day increases the economic and social burdens faced by the population. Given the increasing cost of delaying a resolution, we propose a strategy for Lebanon’s economic recovery that addresses all the dimensions of the crisis while recognizing the need to rapidly kick-start the economic recovery. Creation-Date: 2023-11 Keywords: Lebanon, sovereign debt, international finance Number: 223 Handle: RePEc:glh:wpfacu:223 File-Url: https://growthlab.hks.harvard.edu/sites/projects.iq.harvard.edu/files/growthlab/files/2023-11-cid-wp-439-lebanon-sustainable-recovery.pdf File-Format: application/pdf