Post-war needs
estimated at $11 billion

World Bank’s new assessment raises cost to $14 billion

Post-war reconstruction and recovery needs are estimated at $11 billion, according to the World Bank’s Lebanon Rapid Damage and Needs Assessment (RDNA). Most of the funds ($8.4 billion) are needed for the years 2025–2027.

The total cost of the war has reached $14 billion. It consists of $6.8 billion in damage to physical structures and $7.2 billion in economic losses resulting from reduced productivity, foregone revenues, and operating costs. The current assessment of the war cost exceeds by far the $8.5 billion estimated by the World Bank’s Lebanon Interim Damage and Loss Assessment (DaLA) issued in November 2024.

The housing sector has suffered the largest damage totaling $4.6 billion or 67 percent of the total. It has the largest recovery and reconstruction needs amounting to $6.3 billion and representing 57 percent of total needs.

The commerce, industry and tourism sectors have the second largest recovery and reconstruction needs ($1.8 billion) or 17 percent of the total. These sectors have sustained economic losses of $3.4 billion, the largest chunk of total losses (48 percent).

“A significant portion of the recovery will need to be driven by the private sector, including the provision of around $6-8 billion in financial resources, in particular in the housing and the commerce, industry and tourism sectors. This will likely require public support in terms of policy, investment environment, banking sector reforms, and potentially financial instruments such as guarantees that can help leverage the necessary amount of private capital,” the World Bank said. At least $3-5 billion in direct financing will be required from the public sector, chiefly for investments in the infrastructure, agriculture, environment and human development (education, health).

The World Bank has revised the conflict-induced reduction of real GDP growth for 2024 to eight percentage points, up from an earlier projection of 6.6 percentage points in November 2024. Real GDP is now expected to have contracted by seven percent last year. If the war didn’t happen, the economy would have recorded a growth rate of nearly one percent in 2024, according to the report.