hospitality industry in Lebanon map graphic

Syrian Struggle Sinks Hospitality Industry in Lebanon

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Lebanon, with its Tripoli and Beirut sites, ancient monuments, famed cuisine and rich culture has brought in droves of tourists to eat in their restaurants, stay in their hotels and contribute toward the blossoming hospitality industry in Lebanon. But this same prized geography of the country has put it in too close of a proximity to troubled neighbor, Syria.

Lebanon is located on the western coast of the Arabian Peninsula along the Mediterranean Sea and surrounded mostly by Syria to the north and east and Israel to the south. It has 4 million people and a $61.4 billion GDP.

hospitality industry in Lebanon

Lebanon’s economy is service-directed and, a few years ago, 20 percent of the GDP came from the hospitality industry. But the tourist sector has been directly hit in the last two years.

Political Unrest Spills Over From Syria

Lebanon’s economy has been unstable since 1975 due to civil war, Syria’s occupation of the country and today’s Syrian Civil War. Lebanon, however, did not see a regime change during the Arab Spring.

The country ranks 10th out of 15 Middle Eastern nations as far as economic freedom according to the 2013 Index of Economic Freedom due to “regulatory inefficiency, exacerbated by political volatility.”

Hospitality Industry in Lebanon

Hospitality Industry in Lebanon Sees Tourism Drop

Several Gulf states, in addition to the UK and the US, have advised its residents against traveling to Lebanon. Tourists now are mostly Iraqis, Jordanians, Egyptians and wealthy Syrians.

Due, in large part, to the Syrian conflict, the first six months of 2013 had a 6.5 percent decrease in tourism to Lebanon, compared to 2012. Lebanon also saw a 29 percent drop in tourism spending towards the end of 2012 and a 37 percent drop in the number of tourists since 2010. There’s been a hotel occupancy dip and closures across the country as tourists stay away.

Mixed Results for the Hospitality Industry in Lebanon

Beirut saw the biggest drop in average daily hotel rate’s out of any Middle Eastern city, with a 20.9 percent decrease compared to 2012.

Dubai’s Al Habtoor Group said in January that it was thinking of selling two of its five-star hotels and a mall in Lebanon. Two other four-star hotels north of Beirut shut their doors in January as well.

At the same time as this bad hotel news, there have been some recent positive developments for the hospitality industry in Lebanon. Beirut’s famous Le Bristol hotel announced in June of 2013 that it plans to put $30 million into renovations. And, in July 2013, the Wyndham Hotel Group opened a new Ramada Plaza Beirut Raouche, which has four restaurants.

Ecelectic Cuisine in Lebanon

shwarma from the hospitality industry in Lebanon
Shawarma, a meat sandwich, and falafel are some of the most popular fast foods in Lebanon, available at Lebanese restaurants and stands across the country. In fact, Lebanese restaurants have also been one of the country’s most successful exports. Kababji, a casual Lebanese chain that started north of Beirut and expanded to 30 locations throughout the Middle East, now has its first U.S. location in Washington D.C.

The Big Players in Lebanon’s Hospitality Industry

In 2010 there were about 8,000 restaurants in Lebanon. KFC, Pizza Hut, and McDonald’s are some of the most prevalent Western brands in the country, but restaurants such as Chili’s, Hardee’s, House of Donuts, Johnny Rockets, Popeye’s, Subway, and Domino’s are staking their claim. Canadian healthy fast food chain Fresh Restaurants is planning to expand into Lebanon.

Local Lebanese diner chain, Crepaway, has seventeen locations in Lebanon, with franchises in Egypt, KSA, Qatar, and Jordan.

Sweet Success in Lebanon

No unrest can stop a sweet tooth apparently. The Daily Star newspaper in Lebanon reported in August that companies and sweet shops like the Al Baba Sweets stores have been doing well despite the downturn in the Lebanese economy.

Key Takeaways

  • Lebanon has had a 37 percent drop in tourism since 2010.
  • Beirut’s hotel rates dropped 20.9 percent in 2013.
  • Despite the bleak situation, hotels are still investing in the area. Le Bristol plans a $30 million renovation.

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