BEIRUT: The World Bank on Friday projected that Lebanon’s economy would contract by 6.4 percent this year, as the latest Israel-Hezbollah war derailed the country’s efforts at recovery. Lebanon has been dealing with an unprecedented financial crisis since 2019 and was still reeling from the 2024 Israel-Hezbollah war when the Iran-backed group drew it into the Middle East conflict by attacking Israel in March. Israel responded with a heavy air campaign and ground invasion that Lebanese authorities say have killed more than 4,300 people.

Last year's rebound 'sharply interrupted' by March escalation between Hezbollah and Israel

The World Bank said the Israel-Hezbollah conflict has severely disrupted Lebanon's fragile recovery, predicting a 6.4% contraction in the economy.