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Being the result of all the incoming and outgoing flows of money in the economy, the Balance of Payments gains increasing importance in a country like Lebanon where there is a pegged exchange rate, and where the economy is dollarized. The link between economic performance and the BoP has been proven during the last 5 years where the deficit in the BoP was accompanied by low economic growth.Primarily, the period 2007-2010 was characterized by high growth rates averaging 9.2 percent with the BoP registering sequential surpluses amounting for a cumulative $16.72 billion.On one hand, Lebanon has been suffering from a presidential void for more than 2 years with the country enduring recurring security disturbances in different regions.As a result, Lebanon saw a substantial economic slowdown with growth rates dipping below the 3 percent.In addition, the Lebanese BoP has structural current account deficits that are usually counterbalanced by capital inflows in the capital and financial accounts.This has been the case between 2007 and 2010 when the accumulated deficits of Lebanon's current account valued $19.91 billion, yet were more than offset by the $36.76 billion surplus in capital and financial accounts. Despite the tightening trade deficit and given the unstable environment, several countries, mostly Gulf Cooperation Council's states, issued travel warnings against their nationals visiting Lebanon, triggering lower travel receipts in 2015 by almost 35 percent from 2010's level.
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