Türkiye-Lebanon trade revival: Beirut port restoration sparks hope

In a pivotal development for Middle Eastern commerce, Türkiye and Lebanon are poised to revitalize their trade relations following the catastrophic explosion at the Beirut port in 2020.

This devastating event crippled Lebanon’s primary trade hub – significantly impacting its economy and commercial relationships.

Why it matters: The restoration of Beirut’s port is pivotal for Lebanon’s economy, significantly impacting its trade relations with Türkiye.

“The Beirut Port is the lifeblood of Lebanon. Its recovery is essential not just for Lebanon, but for maintaining robust trade connections across the region,” Abdulkadir Akkus, Chairman of the Foreign Economic Relations Board (DEİK) Türkiye-Lebanon Business Council stated.

What happened?

The 2020 Beirut explosion, occurring on Aug. 4, devastated Lebanon’s capital, killing at least 220 people, injuring thousands, and causing extensive damage to the city’s infrastructure.

• The blast was triggered by a fire that ignited 2,754 tonnes of ammonium nitrate stored at the port since 2013. Originally bound for Mozambique, the chemicals had remained unclaimed because of legal disputes.
• The explosion sent a mushroom cloud over Beirut, with its shockwaves felt as far away as Cyprus, 250 kilometers (155 miles) from the epicenter.
• The destruction of Beirut’s primary trade hub resulted in significant economic disruption, halting trade activities and affecting vital sectors such as consumer goods and industrial materials.

Trade impact

2019 vs. 2020: Turkish exports to Lebanon dropped from $1 billion to $812.5 million due to disruptions caused by the explosion.

• Total trade fell by 22.5%, from $1.1 billion to $837 million
• Lebanon faced a 25% reduction in its gross domestic product (GDP) in the year following the explosion, reflecting the broad economic implications.

Recovery signs

2021 growth: Despite initial setbacks, Türkiye and Lebanon saw a promising rebound in trade. Exports surged by 85% to $1.5 billion, as Lebanese efforts to stabilize and rebuild began to bear fruit.

• Total trade rose by 84% to $1.54 billion, demonstrating a rapid recovery and a renewed commitment to economic collaboration.

2023 update: Exports dipped by 43.3%, reaching $1.4 billion, as Lebanon continues to face economic hurdles but remains determined to rebuild its trading capabilities.

• Trade volume reduced to $1.5 billion from $2.6 billion in 2022, reflecting ongoing challenges but also the resilience of the bilateral relationship.

Strategic initiatives

Government efforts: The Lebanese government is prioritizing the reconstruction of the Beirut Port, recognizing its critical role in economic recovery. The government has secured international funding and expertise to expedite restoration efforts.

Partnership opportunities: Turkish companies are actively participating in reconstruction projects, bringing in expertise and resources to support Lebanon’s recovery.

We anticipate a significant increase in trade volume as the port resumes full operations. The collaboration between Türkiye and Lebanon is crucial for regional economic stability

Abdulkadir Akkus