World Bank2012-03-192012-03-192012-01-01https://hdl.handle.net/10986/2727This report aims to provide a diagnostic of the Lebanese economy and policy advice to a broad audience. To that effect, an analysis of the dynamics of foreign inflows and of the economy over the past decades is undertaken. Specifically, this report attempts to provide a vision for where would Lebanon be in 15 to 20 years if needed structural reforms are implemented. This report provides a quantification of the growth impact of these reforms, taken individually or combined. By doing so, it gives both an indication on the opportunity costs of not reforming and provides a vision on what the development stage could be in Lebanon in 15 to 20 years if reforms are implemented. The report includes a set of econometric simulations and analysis aiming: 1) to establish the relation between the dynamic of foreign financial inflows and deposits over a period of 20 years, 2) to establish the relation between deposits as proxy for foreign financial inflows from one side; and oil price as proxy for regional wealth, macroeconomic and security stability, and policy variables from the other side and, 3) to estimate the relation between economic fluctuations from one side; and bank lending as one of the channels of transmission of foreign financial inflows, and debtor interest rate from the other side.CC BY 3.0 IGOACCOUNTINGACCUMULATION OF RESERVESAGGREGATE DEMANDASSET DIVERSIFICATIONASSETSBALANCE OF PAYMENTBALANCE OF PAYMENTSBALANCE SHEETBANK CREDITSBANK CURRENCYBANK SECRECYBANKING REGULATIONBANKING SECTORBANKING SECTORSBANKING SYSTEMBENEFICIARIESBONDSBUDGET CONSTRAINTBUDGET CONSTRAINTSBUDGET DEFICITSBUSINESS OPPORTUNITIESCAPITAL ACCUMULATIONCAPITAL FLOWSCAPITAL FORMATIONCAPITAL GAINSCAPITAL INFLOWSCAPITAL MARKETSCDCENTRAL BANKCERTIFICATE OF DEPOSITSCHECKSCOLLATERALCOLLATERAL REQUIREMENTSCOMMERCIAL BANKSCOMPETITIVENESSCONSUMER PRICE INDEXCREDIBILITYCREDITORCURRENCYCURRENT ACCOUNT BALANCECURRENT ACCOUNT DEFICITCURRENT ACCOUNT DEFICITSDEBTDEBT REDUCTIONSDEBTORDEVELOPING COUNTRIESDEVELOPING ECONOMIESDISTORTIONSDOMESTIC BANKINGDOMESTIC BANKING SYSTEMDOMESTIC BANKSDOMESTIC CURRENCYDOMESTIC INTEREST RATEDOMESTIC MARKETDOMESTIC PRICESDUTCH DISEASEECONOMIC DEVELOPMENTECONOMIC DEVELOPMENTSECONOMIC GROWTHECONOMIC POLICIESECONOMIC STRUCTUREEMERGING ECONOMIESEQUIPMENTEXCHANGE RATEEXCHANGE RATE REGIMEEXOGENOUS FACTORSEXPENDITUREEXPENDITURESEXPORT PERFORMANCEEXPOSUREFACTORS OF PRODUCTIONFINANCIAL CRISISFINANCIAL ENGINEERINGFINANCIAL FLOWSFINANCIAL INFLOWSFINANCIAL INFORMATIONFINANCIAL INTEGRATIONFINANCIAL MANAGEMENTFINANCIAL MARKETFINANCIAL MARKET DEVELOPMENTFINANCIAL MARKETSFINANCIAL OPENNESSFINANCIAL SECTORFINANCIAL SERVICESFINANCIAL STABILITYFINANCIAL SYSTEMFISCAL AUTHORITIESFISCAL POLICIESFISCAL POLICYFIXED CAPITALFLEXIBLE EXCHANGE RATEFLOWS OF CAPITALFOREIGN BANKSFOREIGN CAPITALFOREIGN CURRENCIESFOREIGN CURRENCYFOREIGN CURRENCY RESERVESFOREIGN DIRECT INVESTMENTFOREIGN INFLOWSFOREIGN INVESTORSFOREIGN TRADEGOVERNMENT SPENDINGGROSS DOMESTIC PRODUCTGROWTH RATEHOLDINGHOME COUNTRYHOST COUNTRIESHUMAN CAPITALHUMAN RESOURCESIMPORTIMPORTSINCOMEINFLATIONINFLATION TAXINFRASTRUCTURE INVESTMENTINTELLECTUAL PROPERTYINTEREST RATEINTEREST RATE SPREADINTEREST RATESINTERNATIONAL BANKINTERNATIONAL INTERESTINTERNATIONAL INTEREST RATESINTERNATIONAL MARKETINTERNATIONAL STANDARDSINTERNATIONAL TRADEINVESTINGINVESTMENT CLIMATEINVESTMENT DECISIONSJOB CREATIONLABOR MARKETLEGAL ENVIRONMENTLEGAL IMPEDIMENTSLIBERALIZATIONLIQUID INSTRUMENTSLOANLOCAL CURRENCYLOCAL FINANCIAL INSTITUTIONSLOCAL MARKETLONG-TERM INVESTMENTSMACROECONOMIC ENVIRONMENTMACROECONOMIC INSTABILITYMACROECONOMIC MANAGEMENTMACROECONOMIC POLICIESMACROECONOMIC POLICYMACROECONOMIC STABILITYMACROECONOMIC VOLATILITYMARKET DEVELOPMENTMONETARY POLICIESMONETARY POLICYMONEY SUPPLYMORAL HAZARDNATIONAL SAVINGOIL PRICEOIL PRICESOPEN ECONOMYOPPORTUNITY COSTSOUTPUTOUTPUT GAPPOLICY RESPONSESPOLITICAL ECONOMYPOLITICAL INSTABILITYPOLITICAL SYSTEMPORTFOLIOPOVERTY REDUCTIONPRICE SERIESPRIVATE INVESTMENTPRIVATE SAVINGPRIVATE-PUBLIC PARTNERSHIPSPRODUCTION STRUCTUREPRODUCTIVE INVESTMENTSPROPERTY RIGHTPROPERTY RIGHTSPROPERTY RIGHTS ENFORCEMENTPROPERTY RIGHTS PROTECTIONPUBLIC DEBTPUBLIC DEFICITPUBLIC DEFICITSPUBLIC EXPENDITUREPUBLIC FINANCEPUBLIC INVESTMENTPUBLIC INVESTMENTSPUBLIC SAVINGPUBLIC SPENDINGPUBLIC UTILITIESREAL ESTATEREAL EXCHANGE RATEREFORM PROGRAMREGULATORY FRAMEWORKREGULATORY FRAMEWORKSREMITTANCESRESERVESRETURNSRISK SHARINGRULE OF LAWSAVINGSSAVINGS RATESSHORT-TERM CAPITALSHORT-TERM DEBTSHORT-TERM DEPOSITSSTABILIZATION OF EXCHANGE RATESTOCK EXCHANGESTRONG CONFIDENCESTRUCTURAL REFORMSTAXTAX EXEMPTIONSTAX POLICIESTELECOMMUNICATIONSTRADE SECTORSTRANSACTIONTREASURYTREASURY BILLSVALUATIONVOLATILE ENVIRONMENTWorld Bank10.1596/2727