Qatar has purchased Lebanese bonds in a planned $500 million investment in Lebanese debt, with the aim to support Lebanon’s struggling economy. The gas-rich country intends to make the rest of the $500 million investment in January, the official said. Following the news, Lebanon’s dollar bonds rallied on Friday, leading to a decrease in its yield.
Lebanon is one of the most indebted countries in the world. The debt has reached 150% of the country’s GDP and Lebanon spends almost half of its fiscal revenue paying interests on that debt. The country also faces a stagnant growth.
“Qatar has always been committed to strengthening its ties with the brotherly Lebanese Republic. Hence it decided to invest $500 million in the Lebanese economy, including purchasing Lebanese government bonds,”a government official said.
Following the announcement that Qatar would inject $500 million in Lebanon’s economy, regional rival Saudi Arabia made a similar commitment just days after, although it has not followed up yet.