How does economic crisis affect business?

Often, small-to-medium businesses don’t have big cash reserves, so when money comes in, it quickly goes to paying bills and other expenses. In a recession, consumers tend to spend less and may delay purchases or payments, which could have a ripple effect on your business’s cash flow and financial commitments.

How does economy affect people’s lives?

Economics affects our daily lives in both obvious and subtle ways. From an individual perspective, economics frames many choices we have to make about work, leisure, consumption and how much to save. Our lives are also influenced by macro-economic trends, such as inflation, interest rates and economic growth.

What is Lebanon main source of income?

Tax revenues are an important source of income for the Lebanese government, among which domestic taxes on goods and services and income tax are the most significant.

What is the impact of recession in our economy?

Recessions result in higher unemployment, lower wages and incomes, and lost opportunities more generally. Education, private capital investments, and economic opportunity are all likely to suffer in the current downturn, and the effects will be long-lived.

How does the economy affect me personally?

For the general public, the main impact is the cost of living. The economy has a direct impact on our spending ability. An economic recession generally leads to an increased cost of living. The countries currency is also generally affected during a recession, which contributes to inflation of prices.

What is happening to the Lebanese economy?

An extreme form of wealth destruction is taking place with the Lebanese de facto losing the majority of their bank savings. Meanwhile, four out of every ten Lebanese are out of work, and half the population is under the poverty line.

Is Lebanon’s economy closing like a vise?

It is closing like a vise on families whose money has plummeted in value while the cost of nearly everything has skyrocketed. Since fall 2019, the Lebanese pound has lost 90 percent of its value, and annual inflation in 2020 was 84.9 percent.

Was Lebanon’s economic crisis predictable?

With hindsight, Lebanon’s economic crisis was predictable. By the time the crisis erupted in October 2019, the economy was facing four extraordinary challenges. First, public sector debt had reached such elevated levels that a default had become a question of when, not if.

What has happened to Lebanon’s political class?

Confronted with these traumatic shocks, the Lebanese political class has been appallingly missing in action. A new government was formed in January 2020 and, to its credit, worked with an international consultant on an emergency economic program and initiated IMF negotiations.