the finance minister said on Wednesday. Jihad Azour said in a presentation that the gross public debt climbed to 63,406 billion Lebanese pounds in 2007 from 60,851 billion pounds in 2006.

But its ratio to GDP slipped to 171 percent from 178 percent in 2006. The net debt to GDP ratio fell to 159 percent from 165 percent in 2006.

Azour said the fall was in part thanks to a primary surplus of 1,102 billion pounds in 2007 compared to a deficit of 6.7 billion pounds in 2006.

"The second reason is some of the assistance of Paris 3, which came as grants that reduced the volume of debt," he added, in reference to an international donors conference for Lebanon in January 2007. "The third reason is the rise in the prices of gold which gives revenue to the Lebanese treasury."

The massive public debt is one of the main strains on Lebanon's economy, which is also suffering from a protracted political crisis that has left the country without a president since November, and paralyzed parliament.

Much of the debt is a result of the costs of reconstruction from Lebanon's 1975-90 civil war.

The state plans to use the $7 billion it hopes to earn from selling majority stakes in two mobile phone firms to pay off debt. But the political crisis has postponed the auction, originally scheduled for February, by three months.

Standard & Poor's last week cut its long-term sovereign foreign currency rating on Lebanon by one notch to "CCC+" from "B-", citing an increase in political instability and the likelihood it will be protracted.

Azour said the latest indicators put 2007 inflation at 5 percent -- higher than a 4 percent estimate he gave in December. Price rises have been fuelled by the higher costs of imports from euro zone and inflation in oil and commodity prices.

The latest central bank indicators put economic growth for 2007 at between 2.5 and 3 percent, Azour said. "The numbers for December and November show that we are closer to 3 than 2.5 ," he said.

Sources: Reuters, Ya Libnan