The Arab Investment and Export & Guarantee Corporation (AIEGC) projected foreign direct investment (FDI) in Lebanon at $3 billion in 2011, a drop of 39.5 percent from $5 billion in 2010, the Lebanon This Week reported. Lebanon is expected to be the fifth largest recipient of FDI in nominal terms among 21 Arab countries in 2011, down from the fourth largest in 2010. Also, FDI inflows to Lebanon would exceed the $2.6 billion in average FDI inflows per Arab country in 2011. But, Lebanon is expected to post the fifth steepest drop in FDI in the Arab world and to be among 13 Arab countries that will post a decline in FDI this year. The AIEGC forecast FDI to Arab economies to contract by 16.8 percent year-on-year in 2011. FDI inflows to Lebanon are estimated to account for 5.4 percent of total FDI in Arab countries in 2011, down from 7.5 percent of aggregate inflows in 2010. Further, FDI inflows to Lebanon are projected to be equivalent to 7.2 percent of GDP in 2011, the second highest in the Arab world after Djibouti at 17.4 percent of GDP. Lebanon was the highest recipient of FDI in the Arab world last year at 12.6 percent of GDP. The World Bank has revised economic growth in Lebanon downward to four percent from a January forecast of seven percent for 2011 and forecast a fiscal deficit of 5.5 percent of GDP. The projected growth rate still makes Lebanon the seventh fastest growing economy in the Middle East and North Africa, which is expected to reach 4.1 percent growth in 2011. The World Bank also forecast Lebanon's fiscal balance would post a deficit of 5.5 percent of gross domestic product in 2011, relative to a surplus of 1.4 percent of GDP for the Middle East and North Africa. The International Monetary Fund too has revised downward economic growth for Lebanon to 2.5 percent for 2011. Lebanon staggers under a public debt of more than $53 billion (38.8 billion euros), equivalent to around 135 percent of the country's GDP.
