Volume 12, Issue 3 -

This paper assesses the economic effects of the July 2006 War in Lebanon. We estimate the economy-wide impacts on the Lebanese regions resulting from the reduction of physical capital stocks using the estimated damages associated with the bombing events. In doing that, we are able to derive the estimates of the short-run economic costs of the War related to the structural break in the availability of economic infrastructure in the country. A discussion on resiliency is also introduced showing how the lack of redundancy in the country’s infrastructure is associated with stronger higher-order negative effects. Moreover, we show how international trade can act as a shock absorber.

Lebanon is expected to have gas resources in its Mediterranean basin, and these could turn the country into a natural gas producer over the next decade. Lebanon’s economy and institutions will thus need to adapt to the challenges and opportunities that such change will bring. In this paper, we address how Lebanon’s fiscal framework will need to be reformulated to take into account potential resource revenue. Designing a fiscal regime appropriately is an absolute prerequisite to make sure that the government can receive a fair share of the resources while investors face appropriate incentives to invest and develop the sector. This step should be followed by setting macro-fiscal anchors and supporting institutions. The prospective framework should be focused on ensuring fiscal sustainability and intergenerational equity, given the estimated relatively short horizon of Lebanon’s gas resources. Strong institutional arrangements also need to underpin the prospective framework, to ensure that the pace of resource wealth’s use is set in line with Lebanon’s capacity constraints.

This paper explores the link between political instability and economic growth in Jordan, which is a lower middle-income country located at the heart of the Middle East. Historically, this region has been living under protracted wars, clashes, violence and terrorist attacks. We can expect these events to influence economic growth via their effect on government spending. We employ two econometric techniques: ARDL model (OLS) and Kalman filter (ML) and use data over the period 1967–2009. We find political instability has a statistically significant negative effect on economic growth as well as on real government expenditures.

The purpose of the present study is to assess the export potential of food and agricultural items from South Asian Association for Regional Cooperation (SAARC) countries to the Gulf Cooperation Council (GCC) countries. We investigated the pattern of trade between the two regions using trade indices and trade data for HS 1–24 categories and also estimated a gravity equation to determine the factors affecting bilateral trade. We extracted UN ComTrade data on exports from the Trademap and the WITS database was used to retrieve data in trade intensities. The results of the descriptive analysis show that India has an advantageous position to achieve more gains from increasing GCC-SAARC food and agricultural trade. The results of the estimation of the gravity equation indicate that the conventional trade cost variables have significant effects on total and food and agricultural trade and India have the highest potential for increasing food and agricultural exports to GCC countries. Further economic cooperation between the GCC and India in the form of a regional integration scheme would enhance trade and food security in the region.