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The Lebanese economy was completely destroyed during the 15-year civil war from 1976 to 1991. Beirut’s position as a major financial and commercial centre for the Middle East was lost. Since the end of the war, both Lebanon and Beirut have gone a long way to re-establishing themselves.

During the civil war, agriculture sustained the population with citrus fruit, olives and cereals as the main products. Light industries include textiles, processed foods and industrial machinery. There are no significant mineral resources in Lebanon, but the manufacturing industry is growing rapidly. In the all-important service sector, the two main components, Banking and Transit Trade have recovered reasonably well. Essential reconstruction, financed by expatriate capital, international aid and foreign investment, began with infrastructure projects. A variety of programmes were consolidated in the ‘Horizon 2000’ under which, beginning in 1993, the Government committed to spending an estimated US$20 billion on reconstruction. However, by the late 1990s, the Government’s failure to control the budget deficit and external debt was causing serious difficulties.

Moreover, Lebanon is critically affected by the political developments in the Middle-East region. At the end of 2000, the Government introduced a major reform programme based on privatisation and promotion of foreign investment. This appears to be paying dividends and, in 2002, it was supplemented by a major bilateral trade deal with the EU. Besides the EU, Saudi Arabia, Syria, the United Arab Emirates and Kuwait are Lebanon’s principal trading partners. Lebanon is a democratic republic with a parliamentary system of government and a cabinet headed by a Prime Minister. Its constitution is based on the separation of executive, legislative and judicial powers, with a president elected every 6 years. 128 Members of Parliament are elected by universal adult sufferage for a four year term. 50% should be Muslims, and 50% Christians. Traditionally the president of Lebanon comes from the Christian Maronite community and the prime minister from the Muslim Sunnite community.

The Lebanese Republic is divided into six regional governments, or Mohafazaat: Beirut, North Lebanon, Mount Lebanon, South Lebanon, The Bekaa Valley and Nabatiyeh.

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