From Crisis to Chance: How Lebanon’s Economic Downturn Might Ignite a New Wave of Entrepreneurship

Bachir Maktabi 

Lebanon is living through one of the most difficult chapters in its modern history. The economy has collapsed, banks have imploded, and years of political paralysis have left people uncertain about tomorrow. Yet, in the middle of this rubble, something remarkable is happening: a spark of creativity and entrepreneurship is beginning to shine.

It is a reminder that Lebanese resilience is not just a cliché, but a force that continues to shape the country’s future.Since 2019, the numbers have been grim. The economy has contracted by nearly 40%. Public debt ballooned, and the banking sector—once the pride of Lebanon—crumbled, erasing billions in people’s savings. Add to this the conflict with Israel and the weight of Hezbollah’s influence, and the toll has been staggering: shattered infrastructure, displaced families, and investors driven away.A slow shift in politicsAnd yet, 2025 brought a flicker of momentum. After years of leadership vacuums, Lebanon now has a government under President Joseph Aoun and Prime Minister Nawaf Salam. Their arrival has broken a long stalemate. In just a few months, parliament passed long-delayed reforms, including amendments to banking secrecy laws and a banking restructuring bill.

These are not small steps—they are the building blocks that the International Monetary Fund has demanded if Lebanon wants a lifeline.Change is also visible at the central bank. Karim Souaid, a seasoned asset manager, was appointed governor, tasked with the impossible: rebuild trust in a banking system most citizens have abandoned.

The IMF cautiously praised Lebanon’s efforts, calling them “progress,” but made it clear that without external funding and political will, reforms risk stalling. Meanwhile, Prime Minister Salam has made his boldest appeal yet: billions in international funding to rebuild the country—and even the controversial suggestion of disarming Hezbollah. His words underline a simple truth: Lebanon cannot afford economic recovery without political courage.A new wave of entrepreneursWhile politicians inch forward, Lebanese citizens are already sprinting ahead. Across the country, startups are rewriting the rules of survival. In 2024 alone, Lebanese startups raised around $250 million in investment, a 50% jump from the year before. Fintech leads the pack, pulling in $100 million as people search for alternatives to a paralyzed banking system. But innovation is everywhere: online education platforms, healthtech services, agritech solutions, renewable energy projects, and creative industries are blossoming.Initiatives like the Beirut Digital District and the national Digital Transformation Strategy are laying the foundation for a digital economy, even as the traditional one falters. Programs such as Project Lebanon’s Startup Pavilion give young entrepreneurs a platform to pitch, connect with mentors, and attract investors. For many, startups are not just about business—they are about dignity, survival, and creating opportunities where the state has failed.Turning crisis into possibilityThe irony of Lebanon’s crisis is that the collapse of old institutions has forced people to build new ones. With banks unreliable and politicians distracted, innovators are filling the gap: creating apps to transfer money, platforms for remote learning, and export-ready brands in food, design, and culture. Backed by diaspora investors and international organizations, this ecosystem is proving that Lebanon still has the talent and vision to matter globally.Of course, the road ahead is fragile. Without political stability and stronger governance, investors may hesitate. And the shadow of regional conflict will always weigh heavily. But Lebanon’s entrepreneurs are sending a powerful message: opportunity can grow in the harshest soil.In the end, Lebanon’s story has always been one of reinvention. Today, as reforms tentatively take shape and businesses rise from the ashes, the country stands at a crossroads. Collapse has been devastating—but it may also be the very spark that ushers in a new era of creativity, innovation, and hope..