This is what awaits Lebanon’s markets after Aoun’s election… Important details

The Al-Arabi Al-Jadeed website published a report under the title: “Lebanon’s markets are counting on political stability after the election of the president,” which stated:

The commercial movement in Lebanon is witnessing unprecedented challenges in light of the successive crises that the country is going through.

The economic crisis began years ago, and with the outbreak of the attribution war in October 2023, the situation deepened further, which negatively affected many commercial sectors in Lebanon.

With the advent of the holiday season, expectations were that the market would recover through increased commercial activity during the Christmas and New Year period, but commercial activity was shy compared to previous years.

Many sectors, such as restaurants and retail, were noticeably affected in light of the security and economic crises that Lebanon went through.

Despite the great challenges these merchants faced, especially after the Beirut port explosion and the interruptions related to the wars, there is some hope that the situation will improve with the improvement of political conditions and the House of Representatives’ election yesterday, Thursday, of Joseph Aoun as President of the Republic, which may restore confidence to the local market.

Relying on political stability

Through these lived experiences, it is clear that the Lebanese, despite the ongoing crises, still cling to hope for a better tomorrow, and are counting on political stability as a major key to the recovery of commercial and economic activity in the country.

In Beirut, where many merchants and shops are based, Jawad (a pseudonym), a small trader in the field of clothing and handicrafts, reflects the difficult situation in the commercial sector.

Jawad says in his speech: “In past years, we used to receive large numbers of tourists and citizens during the holiday period, but this year, even with the ceasefire, commercial activity was very shy.”

He added: “We were unable to maintain the same prices due to low inventory. We were affected from all sides, whether from the security or economic conditions.”

Although the periods following the war witnessed some relative movement during “Black Friday,” most merchants faced difficulty in surviving, especially in light of the increasing import costs and the collapsed economy, according to Jawad.

In this context, the Secretary-General of the Economic Bodies, Nicolas Chammas, stated in an interview with Al-Araby Al-Jadeed that the support war that began on October 8, 2023 greatly affected the commercial movement, especially since most Lebanese citizens’ consumption was limited to basic sectors such as Food, drink, medicine and gasoline, so most other sectors stopped and their commercial activity declined significantly.

With the ceasefire, markets moved relatively in Lebanon during “Black Friday,” but merchants could not maintain the same prices and sales, because that would expose them to losses.

However, they were unable to continue, because the stock ran out, and they faced great challenges during this stage, the most important of which was reconstruction, because a large part of the facilities was destroyed, and another part was unable to be reached by employees to work due to the circumstances, which necessitated its restoration.

Chammas pointed out that “the expatriate delegations did not meet expectations, due to not all flights returning to Lebanon by airline companies.”

Therefore, the movement was timid and less than expected. As for late 2024, the combined activity of the commercial sector, which includes all sectors, was determined according to the weight of each commercial sector.

Consequently, the general rate of decline in consumption movement was between 70% and 75% until the end of last November. This percentage may remain approximately constant, but some sectors have witnessed a decline greater than 70%, while some other sectors that depend on basic materials for citizens have not witnessed this significant decline. As for the complementary sectors, they witnessed a greater decline of up to 80%.

Implications of the election of the president

He explained that the Lebanese consumer is in a state of uncertainty, waiting for the 60-day deadline to implement the ceasefire decision to expire, as he prefers to save his “white penny for the black day.” Also, the absence of political stability has increased the uncertainty of the future vision, according to Shammas.

The Lebanese are awaiting the repercussions of the election of a new president on the markets and various sectors. In this context, Shammas points out that “political stability will be a turning point; First, the situation will change in the consumer’s mentality, as he will begin to think optimistically instead of anxiously…and when the consumer’s vision is optimistic for the near and medium future, he will become more willing to consume.”

While the third challenge is to reactivate the growth of the Lebanese economy, which depends on a recovery plan in agreement with the International Monetary Fund with the aim of building this stage and reaching solutions, according to Chammas, who stressed that the last challenge is to reactivate consumption and the future in Lebanon, and it starts from the point after the election of the president. And the formation of a government, which will restore confidence in the next stage and encourage consumption.

Holiday period in Lebanon

Vice President of the Restaurants, Nightclubs and Cafes Syndicate, Khaled Nozha, spoke to Al-Araby Al-Jadeed about the Christmas and New Year period, “where the Israeli war on Lebanon had a negative impact, affecting all sectors and the return of war and foreigners, and with the ceasefire on November 27.” Last year, the season was very close to the holidays, and it was a very modest season.

We expected this because the war situation was very harsh on the country and affected many areas, and villages and cities were also damaged in various parts of the country.”

Nazha confirmed that the sector’s losses ranged between 50% and 60% compared to last year during the holiday season.

In his speech, he touched on the Syrian crisis and the extent of its impact on the movement of Jordanians via land, while relying on Arabic calligraphy to stimulate the tourism sector.

Nazha reminded that this sector is considered the largest in terms of employing Lebanese, despite the losses it has incurred in recent crises, such as the collapse of the national currency, the Beirut port explosion, and the “Corona” pandemic. With all of the above, Nezha stressed that the Lebanese love life and are attached to their land despite all the crises.

Therefore, the trade situation in Lebanon reflects a state of continuing challenge amid the multiple crises facing the country, and despite the severe damage caused by wars and explosions, there is still hope for the possibility of improvement.
On the other hand, the main purchasing managers index issued by the “Lebanon and Overseas” Bank, affiliated with “Standard & Poor’s”, recorded a noticeable increase in December 2024, reaching 48.8 points, which reflects a clear improvement in the Lebanese economic conditions after the decline in production indicators and new orders. and export orders in the previous month.

The sub-indices of the index show a tangible improvement, especially in the future production index, and the companies that participated in the survey indicated historically positive expectations regarding commercial activity, with expectations of a noticeable recovery in the next 12 months, supported by the ceasefire in the region. (The New Arab)