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Infrastructure in Lebanon
According to the 2018 Lebanon Economic Vision report, Lebanon’s economy has been stuck in a vicious cycle. Despite periods of prosperity, the economy has been highly unpredictable. Any substantial monetary influx is mostly channeled into less productive sectors and into financing a fiscally irresponsible administration. Combined with high levels of corruption and minimal legislative productivity, the resulting unhealthy business environment, second-rate infrastructure and poor development of Lebanon come as no surprise. Job creation and productivity are limited, hurting employment rates and continuing an economic cycle where no incremental wealth is generated. But can things change? 

Power and Electricity

Lebanon has consistently ranked in the top four worst world nations in terms of quality of electricity supply. The country even ranked as the last in the world in this segment from 2012 to 2014. The main electricity producer, Electricité du Liban, is so inconsistent that citizens are forced to purchase a private generator or subscribe to a different network. This means paying the double cost for electricity, and those who cannot afford this are sometimes forced to go without it for hours. However, the Ministry of Economy has presented a plan called the National Economic Vision 2025 to reform this sector and other sectors once and for all. The country aims to shrink non-technical losses by 2025 and to become more reliant on sustainable and renewable resources which would seriously impact the development of Lebanon.

Health Care

The Lebanese health care system is considered to be the best in the region and on-par with European quality standards, a good indicator of the development of Lebanon. Citizens boast a high average life expectancy and low neonatal mortality rates, as around 7.5 percent of GDP is allocated to health care expenditures. Nonetheless, a significant portion of the Lebanese population remains uninsured because of low wages and high insurance rates.

This commonly forces citizens to pay out-of-pocket fees for medical services. Despite these factors, Lebanon is on track to improve coverage and performance under new governance by the Ministry of Public Health. Under this new leadership, the sector will be driven by evidence-based decisions for monetary compensation, meaning more fiscal support goes to hospitals and patients who need it.

Education in Lebanon

Lebanon continues to invest 7.6 percent of GDP on education, a sector that is growing faster than the base economy itself. The country has one of the highest literacy rates in the Arab world. Academia is the sixth largest employer in the country, with about 161,000 employees. Nonetheless, while Lebanese universities continue to hold a strong reputation, the performance of the primary and secondary education system is declining. To combat this, the National Economic Vision plan proposes updates and enforcement of curriculum standards at the primary and tertiary level. Promoting Lebanese universities to attract international students, and increasing technological investments into this sector are also key factors for this plan.

Agriculture

Lebanon has approximately 658,000 hectares of biodiverse agricultural land that ensures the production of more than 60 types of crops and over 10 livestock products. In 2016, the agricultural sector contributed about 3 percent to GDP, or about $1.5 billion. However, over the past decade, growth has been particularly stagnant. The use of land for low-value crops, competition from imports, poor infrastructure and development of Lebanon and limited support for good farming practices are all contributing factors. Nonetheless, a plan to prioritize crops with high export growth potential and to finance technology to modernize farming would offer this sector the stability it is lacking. A focus on sustainable water practices is also a key concern.

Industry

Industry is a top contributor to the Lebanese economy, accounting for 10 percent of GDP and employing around 194,000 people. However, between 2010 and 2016, the sector had a steep decline in productivity, reducing its contribution to GDP by about 2 percent every year. This devastating decline can be attributed mainly to the poor quality and consistency of power supply and an unhealthy business climate.

To combat this decline, plans to expand the international market by adopting and enforcing compliance with industry quality standards has been detailed by the National Economic Vision plan. In addition, investing in specific subsectors that play on the country’s strengths, like jewelry or pharmaceuticals, would help grow the sector as a whole and ensure redevelopment.

Lebanon has distinct economic and social characteristics that could successfully be harnessed for positive change. The National Economic Vision 2025 proposes not only tools for rectification, but also hope for a better future. Investing in infrastructure in Lebanon, enforcing new fiscal rules and increasing revenue would generate job opportunities and stabilize a once volatile economy. A proposed strategy and plan would offer Lebanon a chance to become the prosperous nation it once was and improve quality of life for all of its citizens.

Natalie Abdou
Photo: Flickr

Lebanon
Lebanon is a small nation wedged between the Mediterranean Sea to the west, Israel to the south and Syria to the northeast. Despite its size and a population of only six million, Lebanon became a center of trade in the Middle East during the mid-1900s. It is also known for its diverse culture in which Shia and Sunni Muslims live alongside a large Christian minority and other smaller groups.

The outbreak of the Lebanese Civil War in 1975 undermined the country’s prosperity and stability. The conflict lasted 15 years and Lebanon has struggled to recover ever since. While Lebanon remains a relatively wealthy nation in the region overall, its economic situation has become increasingly complicated and many people living in the country do not benefit from that wealth. Here are the top 10 facts crucial to know about poverty in Lebanon.

Top 10 Facts about Poverty in Lebanon

  1. More than 25 percent of Lebanese citizens live in poverty. That number sinks as low as 16 percent in urban areas like the capital city of Beirut, and climbs to 36 percent in some rural areas.
  2. A person living below the poverty threshold in Lebanon earns less than $266 per month.
  3. Children in poor families are less likely to be able to complete their education. This can trap them in low-skill, high-demand job-markets.
  4. As many as 20 percent of Lebanese citizens live with unimproved sanitation facilities; 10 percent of poor households have no access to clean drinking water.
  5. There are more than one million refugees in Lebanon, with most fleeing the Syrian civil war. Refugees are not counted in many official poverty statistics from Lebanon’s government, meaning that the effects of poverty are significantly more widespread than these statistics suggest.
  6. Nearly half a million Palestinian refugees are registered with U.N. relief organizations in Lebanon. Palestinians may make up as much as 10 percent of the country’s population but they lack several important rights. Many live in U.N. camps in extreme poverty and are denied access to certain types of work.
  7. Poor Lebanese citizens, refugees and women brought in from other countries around the world are vulnerable to human trafficking. Refugees are especially likely to be coerced into forced labor. In 2014, the Lebanese government committed to reducing human trafficking within the country, but the results have been inconsistent so far.
  8. Poor Lebanese workers are often trapped in high-turnover or seasonal jobs with low wages. Making matters worse, the government and U.N. cannot adequately support the huge refugee population in Lebanon, meaning that many of them must find work to survive. This pits citizens and non-citizens against each other. Lebanese workers suddenly face much higher competition for jobs. Meanwhile, refugees lack citizens’ legal protections, which forces many of them to work in difficult conditions for half or even a third of what native workers are paid.
  9. Women (especially heads of households) are often the most impacted by poverty. Many are culturally expected to raise and care for a family but are also forced to enter the workforce to provide additional income. These dual expectations can add to their burden, stifle their educational prospects and make it difficult for them to access highly-competitive jobs.
  10. Social safety programs are rare and inconsistent in Lebanon. Many families are forced to go hundreds or thousands of dollars into debt to cover unexpected expenses like medical bills.

Building a Safety Net

The Lebanese Civil War severely damaged the country’s economy and infrastructure and the modern refugee crisis has only increased the strain. That said, several promising programs could alleviate these problems and reduce the impact of poverty in Lebanon.

While Lebanon’s social programs are still relatively young and often haphazard, the government has formed two primary means of relieving poverty: the National Social Security Fund and the Emergency National Poverty Targeting Programme. Expanding and improving these programs along with continued investment in infrastructure and education could make an enormous difference in the lives of thousands of Lebanese citizens.

Unfortunately, these government programs do not cover refugees. U.N. humanitarian aid has traditionally stepped up to fill this void, but even these resources have recently begun to dry up.

Response from the International Community

These 10 facts about poverty in Lebanon illustrate a complex and ongoing struggle to improve living conditions in the country. As the Syrian conflict continues, the government of Lebanon will have to continue to cope with an unstable region and an increasingly large population of foreign refugees within its borders.

Thankfully, Lebanon is not alone. In April, around 50 countries met in Paris at the CEDRE Conference where they pledged to invest more than $11 billion into Lebanon’s economy. Time will tell if measures like these will accomplish their goal of restoring prosperity to Lebanon and, eventually, to the Middle East.

– Josh Henreckson
Photo: Flickr

Infrastructure in LebanonThe country of Lebanon has experienced years of domestic instability and conflict. However, prior to the civil war that began in 1975, the former French colony was a luxurious tourist destination. Its capital, Beirut, was commonly known as the Paris of the Middle East. With the significant rebuilding of infrastructure in Lebanon, many hope that Beirut may once again be in the international spotlight.

Rebuilding Infrastructure in Lebanon

Following the 2005 peace agreement, Lebanon’s economy grew at an extraordinarily fast rate for a number of years. Growth exceeded 8 percent within a four-year period, from 2007 to 2010. However, even at that time, the country’s needs were immense.

Lebanon’s current gross domestic product is $47 billion, yet the 2010 estimate of necessary spending on infrastructure in Lebanon topped $20 billion. At that time, one government minister suggested that the most valuable development efforts would include projects to connect areas outside the capital with Beirut and the completion of a transportation corridor across the country’s north-south axis.

A 2013 report detailed the results of one $30 million program to repair and enhance infrastructure in Lebanon. Coordinated through the World Bank, the program resulted in the rehabilitation of 175 kilometers of roads as well as reconstruction of 17 public buildings. It benefitted an estimated 178 municipalities across the country.

Recent Developments

More recently, the country’s improved trajectory has been somewhat obstructed by the civil war in neighboring Syria. Lebanon has hosted the largest number of refugees from that conflict and this burden has strained the country’s resources.

As a result, economic growth has also slowed. Fortunately, growth has not turned negative, and some infrastructure projects continue as the international community addresses the refugee crisis. The United Nations Development Programme and the U.S. Agency for International Development each have numerous ongoing projects in Lebanon. Additionally, international travelers are again recognizing Lebanon as a desirable vacation destination.

Improved stability and rebuilding have the potential to return Lebanon to its former status as an international hub. Such an outcome would greatly improve the lives of its six million citizens. It could also make this Mediterranean nation, with historical ties to both Europe and the Arab world, a valuable trading partner in future years.

– Paul Robertson

Photo: Flickr

Credit Access in LebanonThe country of Lebanon sits on the coast of the Mediterranean Sea and is bordered by Israel to the south, Syria to the west and Turkey to the north. Lebanon’s tumultuous history with its neighbors has hindered its economic growth and recovery. The last two decades have seen Lebanon wrapped up in wars and invasions from its neighbors.

Since 2011, over one million refugees from the Syrian Civil War have registered with the Lebanese government. These refugees live in camps, supported by the U.N., among the Lebanese population in major cities. The influx of one million people in six years has severely strained the economy of a country of only six million. A report by the World Bank claims that this influx has limited credit access in Lebanon.

Wars, occupations and bombardments have damaged Lebanon’s infrastructure. Although much of the damage was done to Lebanese cities, the countryside was not untouched. Any damaged farmland can significantly hurt credit access in Lebanon. Much of the rural population lives in poverty and already had difficulty gaining access to credit before the war in 2006; damaged fields and lower crop yields only made this more difficult.

To increase credit access in Lebanon, specifically to rural farmers, the International Fund for Agriculture Development (IFAD) launched a program targeting these farmers, called the Hilly Areas Sustainable Agricultural Development Project (HASAD). By organizing crop rotations, water access and soil conservation, the project aims to increase the productivity of the farmers. An increase in crop yield means higher profits for the farmers, which could, in turn, increase their access to credit.

Credit access in Lebanon is much easier to gain in urban areas, where more of the country’s wealth is located. After 16 years of civil war (1975-1990), people found that the banks could not offer sufficient credit. Kalafata was founded in 2000 to assist banks and help small businesses gain credit access in Lebanon. The organization is supported by the European Union, the World Bank and the Lebanese government.

Since the beginning of the refugee crisis, Lebanon’s economy has only grown by one to two percent each year. The refugees have increased the amount of available labor, but many Lebanese blame them for taking their jobs. This increase in labor could potentially help small businesses boom, which will hopefully increase the growth of the Lebanese economy.

Economic growth and credit access in Lebanon will continue to be hindered by the instability of the region. Unfortunately, regional stability does not look to be anywhere in sight. Recently the Prime Minister of Lebanon Saad al-Harir stepped down from power, claiming he feared for his life. This has sparked outrage from the Presidents of Lebanon and Iran. Both parties claim that this is interference from Saudi Arabia. The leader of Hezbollah has decried that this is an act of war against Lebanon.

Most recently, President Donald Trump declared that the United States will move its embassy in Israel from Tel Aviv to Jerusalem, increasing tensions in the Middle Eastern region and possibly hindering the further development of nations like Lebanon. Lebanon’s greatest hope for its future lies in itself and how it will continue to handle the refugee crisis. Perhaps allowing refugees access to work opportunities and credit in Lebanon will give the nation’s economy the boost it needs.

– Nick DeMarco

Photo: Flickr