For the year 2020, Lebanon’s trade deficit totaled $7.75B, narrowing from the $15.50B registered by end of year 2019. In fact, total imported goods retreated by 41.2% year-on-years (YOY) to $11.31 in December 2020. Whereas, Lebanon’s total exports declined by 4.7% YOY to $3.56B during the same period.
In term of value, the “Mineral products” grasped the highest share of total imported goods with a stake of 28.68%. “Products of the chemical or allied industries” ranked second, composing 14.89% of the total imports, while “Machinery, electrical instruments” and “Pearls, Precious stones and metals” grasped the respective shares of 7.94% and 7.90%.
In details, Lebanon imported $3.24B worth of “Mineral Products”, compared to a value of $6.60B in the same period last year.
In turn, the values of “Products of the chemical or allied industries”, “Vegetable Products” and “Prepared foodstuffs; beverages, tobacco” recorded yearly drops of 15.46%, 14.52% and 37.80% to settle at $1.68B, $796.83M and $755.36M, respectively. It is worth noting, that the values of “Vehicles, aircraft, vessels, transport equipment” recorded yearly drop of 59.80% to settle at $472.36M.This decrease is explained by the big reduction in car sector in Lebanon, which incidentally dropped by more than 90% in early 2021.
The top three import sources by December 2020 were Turkey, China, and Greece grasping the respective shares of 9.77%, 8.71% and 7.20% 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 39.60% of the total. Moreover, “Prepared foodstuffs, beverages & tobacco” and “Machinery, electrical instruments” each grasped a share of 10.54% and 8.76%, respectively, of the total.
In detail, the value of “Pearls, precious stones and metals” decreased yearly by 3.10% to $1.40B by December 2020. Meanwhile, the value of “Prepared foodstuffs, beverages & tobacco” observed an uptick of 1.03% to reach $375.40M while “Machinery, electrical instruments”, witnessed a yearly decline of 18.28% to reach $311.82M by end of year 2020.
By the end of year 2020, the top three export destinations were UAE, Switzerland and Saudi Arabia with the respective shares of 20.27%, 9.36% and 7.94%.
Unsurprisingly, the volume of imports has been on a sharp decline since the devaluation of the Lebanese pound. Nevertheless, pressure on the Lebanese pound is still intensifying due to the high demand on the dollar currency. However, the old economic model for Lebanon is not redeemable, a clear and sustainable economic vision is an absolute necessity where exportations must have the biggest share from this economic reform as the external demand on our local production could provide the domestic economy with a buffer and a significant source of growth.
Trade Deficit by December 2020 ($B)
Source: Customs Administration, BLOMINVEST