This report focuses on the impact of the war on micro and small enterprises which, together with medium-sized enterprises, have historically been one of the most important sources of employment and income in Lebanon. Developing the potential of micro and small enterprises to contribute to poverty reduction and sustainable recovery and growth will require, inter alia, a more conducive legal and regulatory framework geared towards entrepreneurship development, greater access to business start-up capital and opportunities to enhance basic business management skills, and a more effective business services infrastructure. While some of the constraints on the development and performance of this sector pre-date the war, they have been further exacerbated by it, thus making it all the more imperative to overcome these constraints in the war’s aftermath.
The report is based on the results of a post-war survey of micro and small enterprises in Lebanon, undertaken by CRI, in partnership with UNDP and the ILO, using a sub-sample of an earlier comprehensive survey of this sector undertaken by CRI in 2004. The post-war survey highlights the negative impact of the war on all enterprises, irrespective of their geographic location and provides evidence of a decline in household incomes and an increased dependence on local markets. The survey also highlights that the conflict has worsened the pre-war constraints in the business environment, thus requiring immediate attention to both financial and infrastructural needs. Perhaps the most encouraging finding is that despite anticipating difficult conditions in the future the entrepreneurs remain resilient and expect their businesses to rebound.