In its latest Lebanon Economic Monitor report, entitled The Normalization Of Crisis Is No Road For Stabilization and published on May 16, the World Bank attempts to estimate the size of the cash economy in Lebanon, i.e. the total value of transactions carried out in cash in dollars in the country.
Estimated at USD 4.5 billion in 2020 (14% of GDP) then at USD 6.1 billion in 2021 (26% of GDP), the cash economy would have represented USD 9.9 billion in 2022 (46% of GDP ). Most of the increase in the size of the cash economy in 2022 compared to 2021 is attributed by the World Bank to a slowdown in capital flight.
The size of the cash economy relative to GDP is also significantly larger in 2022 than in 2021 due to the decline in GDP. These estimates are based on a number of assumptions and should be interpreted with caution.
According to the World Bank, the development of the cash economy increases the risk of money laundering, increases the share of the informal economy and facilitates tax evasion.
Source: World Bank