UPDATE 1-Syria, political instability hammer Lebanon's budget

BEIRUT, March 11 (Reuters) - Lebanon's budget deficit jumped 67 percent in 2012 to $3.93 billion, the Ministry of Finance said on Monday, after a year of slowing growth due to the Syrian civil war and domestic political instability.

Last year Lebanon also logged its first primary deficit, in which government finances are in deficit before debts are paid, since 2006, the data showed.

The deficit for 2011 was $2.35 billion, the ministry said.

The International Monetary Fund said in September that poor government economic policies have contributed to a slowdown of investment in Lebanon; businessmen complain that the government, constrained by sectarian rivalries, has been slow to reform state finances and improve infrastructure.

A civil war in neighbouring Syria has also affected Lebanon, with sporadic episodes of cross-border violence and Syria-related clashes as well as plunging tourism revenues.

Lebanon saw rapid growth of around 8 percent for four years until 2011. But the IMF expects growth of 2 percent in 2012 and 2-1/2 percent in 2013.