Beirut, Lebanon – Shortly after Mario Habib opened his barber shop in 2006, a war broke out between Israel and Hezbollah. Twenty years on, he’s living through another war.
Mario, a 51-year-old with tattoos and short black hair, jokes with clients as he cuts their hair. But he has noticed he isn’t as busy as before. Israel’s war on Lebanon and the US-Israel war on Iran are damaging Lebanon’s economy. Prices are rising due to supply issues, particularly oil from the Gulf region.
“The price of running the generator is killing me,” he said. “Everything has gotten more expensive, the price of petrol doubled, the supermarket is more expensive, even the products I use got more expensive.”
Lebanon’s government had been optimistic about the economy last year, with the World Bank recording 3.5 percent GDP growth in 2025. But the war and global impact from the war on Iran have eradicated that growth.
In March, inflation hit an 18-month high in Lebanon. Bank Audi now predicts zero percent GDP growth in 2026 if the war continues.
Despite the hits, Mario refused to raise prices. “I always prefer that the person who comes here is comfortable,” he said.
On March 2, Israel intensified its war on Lebanon. After 15 months of Israeli ceasefire violations, Hezbollah responded to Israeli attacks and the assassination of Iran’s Supreme Leader.
This was the second time Israel expanded attacks on Lebanon in less than two years. But it came amid a myriad of other crises, which economists say have had a compounding effect on Lebanon’s economy and society.
In 2019, years of financial mismanagement led to a banking crisis. The Beirut port explosion in 2020 killed 218 people. In October 2023, Hezbollah and Israel went to war, displacing thousands of Lebanese.
In 2024, Israel intensified attacks, displacing over one million people. An economic rebound followed the November 2024 ceasefire deal, but Israeli attacks since March have ruined that.
The US-Israeli war on Iran has increased global prices, especially fuel. Economist Sami Zoughaib said Lebanon is experiencing “a very unique moment in economic history.”
“This is a war that comes after a war,” Zoughaib said. “It comes after institutional collapse. It comes after one of the worst financial crises in history.”
If this pattern continues, Lebanon’s economy could soon be unviable. The World Bank put reconstruction costs at about $11bn.
The poorest and most vulnerable are hit hardest. Remittances to Lebanon were about $6.6bn in 2023, but are expected to drop significantly this year.
The war has exacerbated internal divisions in Lebanon. The displacement crisis has mostly affected the Shia community. Zoughaib said political elites may fuel these divisions.
“That is, for me, very dangerous,” Zoughaib said.
Source: www.aljazeera.com