The difficult economic situation and political deadlock in the country are still weighing on its external balance.
According to the Central Bank of Lebanon, the balance of payments recorded a deficit of $4.08B by November compared to a deficit of $1B by the same period last year. In fact, the NFAs of the Central Bank and commercial banks dropped by $1.08B and $3B respectively, over the same period.
Moreover, the BoP recorded a monthly deficit of $953.9M in November 2018 alone, compared to a surplus of $68.2M in November 2017. In November 2018, the NFAs of the Central Bank slid by $2.27B while the NFAs of commercial banks rose by $1.32B over the same period.
However, when we adopt the IMF’s way of computing the Balance of Payments (BOP) by not including the Eurobonds held by BDL into its foreign assets, the BOP deficit becomes $6.57B by November 2018. The Net Foreign Assets (NFA) of BDL and those of commercial banks would have slipped by $3.57B[1] and $3B respectively, by November 2018.
Balance of Payments (BoP) by November (in Millions $)
Source: BDL
1] This is according to the International Monetary Fund way of computing the BOP by not including Eurobonds held by BDL into its foreign assets. We estimated these Eurobonds to be around $2.5B.