Lebanon has been swept up in the recent trend of capital flight from emerging markets. The country has several points of vulnerability: its debt is enormous at 153% of GDP (behind only Japan and Greece), and well over a third of government revenue goes into servicing that debt; it’s running a high current account deficit of 25.8% GDP (IMF forecast for 2018); economic growth is a moribund 1.5%; and its budget deficit has been floating around the double-digits in terms of GDP percentage over the past few years.

Whether it’s in Turkey, India, or Argentina, these economic and fiscal vulnerabilities have been enough to produce destabilizing capital flight as investors seek safer returns in developed markets that are normalizing interest rates.

Lebanon is no different. Yields have been spiking over the past few months in the country’s USD-denominated bond markets. According to the Financial Times, yields on dollar-denominated bonds in the JPMorgan EMBI index have jumped by 3.3% on average since April, bringing them to 10.3%. At the start of 2018, the same yield was as low as 4%. The cost of insuring Lebanese debt has risen in tow, with a one-year credit default swap on government paper jumping 480 basis points over the past two weeks.