The devastating civil war in Syria isarguably one of the major civil conflicts in recent times.The conflict started with protests in March 2011 and soonafter escalated to a violent internal war with no end insight to this date. The conflict has by the end of 2014caused well in excess of 150,000 fatalities, and 6 millioninternally displaced people (UN), and led 3 million refugeesto move out of the country (UNHCR). Beyond the humantragedy, the conflict has disrupted the functioning of theeconomy in many ways. It has destroyed infrastructure,prevented children from going to school, closed factoriesand deterred investments and trade. The economic effects ofthe war extend beyond the country’s borders affecting alsothe neighboring countries. In particular trade is one of themain channels through which the effects of the crisis aretransmitted to neighboring countries. For example, thedemand for goods and services in Syria is likely to havefallen thus affecting the many exporters to Syria inneighboring countries. Moreover, to the extent that Syriahas become harder to cross, the war may have made tradethrough Syria more difficult. At the same time producers inneighboring countries may have replaced Syrian producers inSyria and in other markets as their productive assets inSyria were destroyed. This report examines the effects ofthe Syrian war on the Lebanese economy via one of the mostimportant channels through which the economic impact of thewar occurs, i.e. the trade channel. In doing so, it partlyupdates and extends the previous economic assessment ofWorld Bank (2013b) carried out last year. Focusingspecifically on trade allows us to examine in more depth thetrade effects than that report was able to do. Indeed, we gobeyond the effects on aggregate and sectoral imports andexports to also examine the effects on exports at firms’level, comparing the effects in Lebanon with those in otherneighboring countries, including Jordan, Turkey and Iraq.
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