The election of President Michel Aoun inOctober 2016 after almost two and a half years of apresidential vacancy, and the subsequent formation of anational unity government have generated hope for theresuscitation of the political process in Lebanon.Nonetheless, the protracted Syrian conflict is markedlyworsening the country's vulnerabilities and remains animpediment to the return to potential growth. For the fifthyear, Lebanon persists as the largest host (on a per capitabasis) for displaced Syrians. In 2016, real GDP growthunderwent a slight acceleration to reach an estimated 1.8percent, compared to 1.3 percent in 2015. This was driven byan improvement in the real estate sector, marking a lowthreshold-effect from a weak performance in 2015 – cementdeliveries expanded by 4.4 percent in 2016 compared to acontraction of 8.6 percent in 2015. Real GDP growth was alsoboosted by tourist arrivals, an indicator that registered an11.2 percent growth in 2016. Nonetheless, economic activitypersists below potential, inhibited by geopolitical andsecurity conditions, which remain decidedly volatile.
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