Buoyant Consumption To Boost Growth

BMI View: We see Lebanon's economy growing by 6.5% in 2011, a marginal slowdown from the 7.0% growth we expect in 2010. Our slightly more optimistic outlook is supported by resilient consumer confidence and a drop in imports which will reduce the drag effect of net exports. However, the central bank governor of Lebanon has stated that he expects the economy to grow at approximately 7.5% this year. The Lebanese government is less optimistic, predicting a slowdown to 4% in 2011, which is reflected by the fact that it will be cutting public expenditure in order to channel more money into bringing down the budget deficit from this year's 10.7% to 9.9% of GDP by 2011.

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