Lebanon's recent wars with Israel have cost the country more than $20 billion, with the total expected to exceed $27 billion, Prime Minister Nawaf Salam said on Tuesday.
Salam said the "first war", which began on 8 October 2023, cost around $14 billion, according to World Bank estimates. This included approximately $7.2 billion in physical damage and $6.8 billion in economic losses from disrupted activity and reduced production and revenues.
The "first war" also killed more than 4,000 people and injured more than 16,000, Salam said.
The "second war", which began on 2 March 2025, has so far incurred direct costs estimated by the World Bank at between $3 billion and $4 billion. The figure does not include indirect economic losses, which Salam said had reached at least $4 billion to $5 billion.
More than 4,000 people have been killed and over 12,000 injured in the latest war, he said.
Salam said the combined cost of the two wars would certainly exceed $20 billion and could surpass $27 billion once the full cost of the 2026 war is calculated.
He said the figures did not capture the full cost to Lebanon, including the emigration of skilled workers, lost investment, disruption to education, declining land and asset values and delays to recovery from the financial crisis that began in 2019.
Economic impact
Lebanon, which recorded economic growth of 4.2% last year as it began a gradual recovery, is expected to contract by 6.4% this year, Salam said.
Inflation has also accelerated, largely due to external factors including higher global oil prices resulting from the regional war, declining remittances and a massive drop in tourism activity.
Salam was speaking as Lebanon's parliament began a two-day session on Tuesday to discuss the work of his government, amid political disputes over Hezbollah and the state's control of weapons, as well as social and economic issues.
More than 250,000 Lebanese people remain displaced, while the latest war completely or partially destroyed 91,000 housing units, in addition to around 230,000 units damaged during the previous war, Salam said.
He added that villages and towns had also been entirely destroyed.
The Lebanese government and the United Nations have launched two emergency humanitarian appeals, with total response needs estimated at $639 million.
But, only 49.8% of the required funding has been secured, compared with 94.9% in 2024, according to Salam.
He attributed the shortfall to donor fatigue, shifting global priorities and declining international engagement, warning that it posed a risk to the continuity and scope of humanitarian assistance.
Salam said the government's objective was not simply to manage the displacement of people from southern Lebanon, but to enable them to return to their homes and livelihoods.
"We are therefore moving today from managing displacement to addressing the challenges of return and recovery," he said.
Israel continues to occupy parts of southern Lebanon and carry out attacks across the country. At least 8,948 people have been killed and 30,638 injured in Israeli attacks on Lebanon since 8 October 2023.
Financial reforms
Salam said financial reforms were among the Lebanese government's main priorities.
His government has referred a draft amendment to the banking reform law to parliament, in line with recommendations from the International Monetary Fund. Parliament has also approved amendments to the banking secrecy law.
Salam said the government's approach to the 2027 budget would prioritise stability rather than a deficit that could cause volatility and undermine confidence.
It would also seek to protect vulnerable groups without undermining financial sustainability, invest in growth without uncontrolled spending, continue reforms rather than postpone them, and increase revenue through tax and customs compliance rather than placing additional burdens on the economy and citizens.