Lebanon Faces $11 Billion Reconstruction Challenge Following Conflict, World Bank Report Finds

The report evaluates the damage, losses, and financial needs across ten key sectors nationwide, providing a comprehensive outlook on the economic and infrastructural impact of the conflict.

A new World Bank report, the Lebanon Rapid Damage and Needs Assessment (RDNA) 2025, estimates that Lebanon requires US$11 billion for reconstruction and recovery in the wake of the conflict that took place from October 8, 2023, to December 20, 2024. The report evaluates the damage, losses, and financial needs across ten key sectors nationwide, providing a comprehensive outlook on the economic and infrastructural impact of the conflict.

Breakdown of Recovery Costs

According to the assessment, of the total US$11 billion required for reconstruction:

• US$3 to 5 billion must be publicly financed, including US$1 billion allocated to infrastructure sectors such as energy, municipal and public services, transport, and water systems.
• US$6 to 8 billion will rely on private investment, predominantly directed toward the housing, commerce, industry, and tourism sectors.

Economic Toll of the Conflict

The report also calculates the overall economic cost of the conflict at US$14 billion, comprising:

• US$6.8 billion in physical damage to infrastructure and buildings.
• US$7.2 billion in economic losses, including reduced productivity, foregone revenues, and increased operational costs.

Housing has emerged as the hardest-hit sector, with damages totaling US$4.6 billion, while commerce, industry, and tourism sectors have incurred losses of US$3.4 billion nationwide.

Geographically, the Nabatiyeh and South governorates bore the brunt of the damage, followed by Mount Lebanon, which includes Beirut’s southern suburbs.

Macroeconomic Impact

The conflict has significantly strained Lebanon’s economic trajectory. The report highlights that in 2024, Lebanon’s real GDP contracted by 7.1%, a stark contrast to the projected 0.9% growth in a no-conflict scenario. This setback has deepened the country’s prolonged economic crisis, bringing Lebanon’s cumulative GDP decline since 2019 to nearly 40% by the end of 2024.

Methodology and Key Collaborations

The Lebanon RDNA was commissioned following a formal request from the Government of Lebanon to assess damages across ten critical sectors:

• Agriculture and Food Security
• Commerce, Industry, and Tourism
• Education
• Environment and Debris Management
• Energy
• Health
• Housing
• Municipal and Public Services
• Transport
• Water, Wastewater, and Irrigation

Conducted in technical collaboration with the National Council for Scientific Research – Lebanon, and coordinated with UN agencies and other development partners, the assessment adheres to the internationally recognized Post-Disaster Needs Assessment (PDNA) methodology, jointly developed by the European Union, the World Bank, and the United Nations.

This hybrid methodology integrates multiple data sources, including:

• Ground surveys and key informant interviews
• Sample visual inspections
• Satellite imagery and Synthetic Aperture Radar analysis
• Anonymized cellphone data
• Social media analytics

The findings of this assessment serve as a crucial foundation for developing a sustainable reconstruction and economic recovery strategy for Lebanon, ensuring that both public and private sectors can collaborate effectively to rebuild the country’s essential infrastructure and services.