Michel Pharaon, a veteran of Lebanese politics, first served as minister of state in 2000. The March 14 politician may not have been hoping for the tourism portfolio, but since his appointment in February he has shown enthusiasm for boosting the sector. Executive sat with him to discuss expectations for the summer, tax breaks and the Gulf travel ban.
What brought you to accept this job in the current climate?
I was told that at one point maybe I would be minister of economy which is more my area [but] the prime minister thought I could do the job in tourism. So I said, “Why not?” because tourism is serious, but it is serious to be fun.
How bad is the situation for Lebanese tourism right now?
When I took office in mid-February things looked very difficult, with a big crisis in tourism. It was not that it was [just] a 10 or 15 percent drop in visitors. In 2010 there were 2.3 million visitors, in 2013 there were 1.3 million. There was no confidence anymore after three years of deterioration and political, security and economic tensions.
In fact when I talked with those responsible for those sectors, they brought up politics and security. It is obvious that security and tourism are twins, inseparable.
I see for tourism and Lebanon a hope of trust — it is not yet trust, but a hope of trust. Why? Because this government was formed more on a security agreement than a political agreement. You can say this government [is] calming down the political struggle, a pause in the political fight in Lebanon. This is why it is positive.
This security agreement [is bigger than] political differences. This is a guarantee. Immediately the government launched a security plan and we saw how it succeeded in Tripoli and in the Bekaa. It is working and it is holding because the security agreement tops political differences. We were on the edge of the cliff.
But all you have done is stop on the edge of the cliff, you haven’t reversed yet. You haven’t dealt with the political disputes.
We haven’t reversed politically and the Syrian crisis is still there, and the Iraq crisis is still there and the regional crisis is still there. But yes we have reversed totally security-wise. So you have now a very important margin. The tensions were becoming clashes but now there is really some hope.
Will this improvement in security have a short-term impact on tourism?
The Lebanese know that despite the security problems and clashes, there was security in 80 percent of Lebanon, which is maybe better than many cities in the world. The fear is high so [people think] ‘‘if we are not in Lebanon we should not go.’’ Now, there is security on the horizon.
While perception is important, numbers of Gulf tourists have declined dramatically. Do you have specific plans to boost these numbers?
I have decided that to have credibility we will wait a little bit for the security plan [to take hold] and we will not market [tourism in Lebanon] before end of April. And there is Arabian Travel Market [held in Dubai in early May]. We will go there and say, you can come and the government is responsible. In the government we were all ministers of defense and interior in the last few months, from the middle of May everybody has to be minister of tourism.
What we are saying is that you have security … we guarantee the security of tourists.
So Lebanese ministries are collaborating with you with the specific aim of improving the security environment for tourists?
Last year at the Arabian Travel Market there were emphatic appeals from your predecessor Fadi Abboud to bring more tourists to Lebanon. But at the tail end of the event the UAE reiterated its travel ban against Lebanon. Is there any way we can have confidence they will not do the same again?
This is a good question. This is what I am working on with the president, with the prime minister and with the minister of foreign affairs — who has to be sensible. The last foreign minister was doing a lot of harm.
Some Kuwaitis are beginning to come back, even if there is no official lift in the travel ban. At one point in time there was a non-official travel ban, then it became official. Now there is a non-official lift of the travel ban.
Why are they not lifting it officially?
It is the same for some Europeans, who unofficially are lifting. When the ambassadors are contacted they all say, “Yes, you can come,” but they still have the travel ban for the general public. This is the situation now, so we will work on this.
Do you have a good budget for the promotion campaign?
No, this ministry has a very low budget. We are working with some agencies that are giving their advice for free and we think that the Lebanese are good ambassadors, and they are free marketing agents. You have to give them the tools, and the tools for them are security. Then they will come and bring others. There will be a marketing effort and we are putting the ministry on full gas to have ready by mid-May a special website to show all the tourist assets of Lebanon which will be totally new.
What about support for pre-existing organizations? Are there any movements towards tax breaks for hotels that are struggling? Did you manage to get these laws through parliament last month?
One of the bills [that was passed] was for touristic establishments, which was to lift the penalties on back taxes. The other thing we are trying to do with the president of the central bank is to bring back subsidies on interest rates, which were unfortunately lifted by the last finance minister. It was really a good incentive for tourism and I am sorry he did it.
The banks in the last two or three years have had problems with some credit so it was really putting some strain on the credit for tourism. We are trying to create an atmosphere to help it again because it is a very big sector, almost 20 percent of GDP.
On niche activities, you have mentioned healthcare tourism in recent interviews. Politicians have been talking about this for over a decade, but done little. In that time Jordan, Dubai and other countries have grown rapidly. What healthcare niches do you see for Lebanon?
To tell you the truth, the previous minister Fadi Abboud had planned a fair in Dubai for health tourism, a regional fair with special participation for Lebanon. It was supposed to happen in May but I postponed it to October because I saw there was not enough participation of Lebanese actors and the budget was quite high.
We have seen the way Jordan has developed into this niche, Dubai is developing into this niche, even Saudi Arabia is moving into this area. We still have a niche with the traditional exporters, which are now less in the Gulf, but with four countries: Iraq, Libya, Yemen and Algeria. For general hospital treatments [we have a niche with] these countries and there is still a very important niche from the Gulf for special treatments.
Are we talking cosmetic surgery?
Cosmetic surgery and these kinds of things. There is still a niche. This is my opinion but I want to discuss this.
Iraqi tourist numbers have grown rapidly and now Iraq is the largest Arab country in terms of numbers in first quarter of 2014. Do you have other specific projects to bring them to the country?
It is going well. We are monitoring the rise of Iraqi tourists to Lebanon. We are not promoting it and we don’t have to. We are monitoring it because it is a natural phenomenon. To encourage it, General Security has made some steps to facilitate their visas; they have even done some steps with other countries.
It seems you have major plans for the sector that could take years to implement. Yet your term is due to end with the election of a new president at the end of May. If you are building a “hope of trust” how can you guarantee this when the country may again have no government in a few weeks?
It is a good question. When you go into a company you say, “What can I do in two months and what can I do in one year?” So we are doing in two months what we can do and hopefully others will continue. Everything we do [can] be continued. There are some other ideas we will put on the table with a program at the end of May. We are going to do our work to prepare for the summer.
It is not that we have big programs, but there is something to be done and we are doing it.