By September 2020, Lebanon’s trade deficit totaled $5.25B, narrowing from the $12.49B registered in the same period last year. In fact, total imported goods retreated by 48.52% year-on-year (YOY) to $7.88B in the first nine months of 2020. Meanwhile, Lebanon’s total exports declined by 6.39% YOY to $2.63B during the same period. Lebanon’s financial sector entered an unprecedented crisis in October 2019, since then Lebanon has relied on dollar inflows from abroad and BDL’s foreign reserves to finance imports and public spending and to maintain the Lebanese lira-to-USD peg, in place since 1997.
In term of value, the “Mineral products” grasped the highest share of total imported goods with a stake of 30.06%. “Products of the chemical or allied industries” ranked second, composing 15.39% of the total imports, while “Vegetable Products” and “Pearls, Precious stones and metals” grasped the respective shares of 7.53% and 7.50%.
In details, Lebanon imported $2.37B worth of “Mineral Products”, compared to a value of $5.21B in the same period last year. In fact, the net weight of imported “mineral fuels, oils and their products” decreased since last year and witnessed a yearly drop from 10,186,004 tons in September 2019 to reach 6,256,845 tons in September 2020.
In turn, the values of “Products of the chemical or allied industries”, “Vegetable Products” and “Prepared foodstuffs; beverages, tobacco” recorded yearly drops of 22.10%, 19.18% and 41.46% to settle at $1.21B, $592.9M and $560M, respectively. It is worth noting, that the values of “Vehicles, aircraft, vessels, transport equipment” recorded yearly drop of 67.66% to settle at $312.7M.
The top three import sources by September 2020 were Greece, US and Italy grasping the respective shares of 8.07%, 7.3% and 6.8% of the total value of imports.
On the exports front, Lebanon’s top exported products were “Pearls, precious stones and metals” grasping a share of 40.24% of the total. “Prepared foodstuffs, beverages & tobacco” and “Machinery, electrical instruments” followed, each grasping a share of 10.57% and 9.05%, respectively, of the total.
In detail, the value of “Pearls, precious stones and metals” declined yearly by 3.13% to $1.06B by September 2020. Meanwhile, the value of “Prepared foodstuffs, beverages & tobacco” observed an uptick of 1.11% to reach $278.25M while “Machinery, electrical instruments”, witnessed a yearly decline of 16.10% to reach $238.1M by September 2020.
By the 3rd quarter of 2020, the top three export destinations were Switzerland, UAE and KSA with the respective shares of 32.98%, 10.4% and 6%.
It is worth mentioning that the volume of imports is expected to further decline in the upcoming months in light of the foreign currency shortages and the ongoing political instability; especially if the BDL stops the support of essential goods including basic food, medicines and fuel.
Trade Deficit By September 2020 ($B)