It is time to celebrate. After 22 years of occupation in South
Lebanon, Israel pulled out quickly and quietly, leaving the
country with a sense of relief and a brighter picture for the future.
But it is also a time to worry. Solidere, Lebanon’s biggest company,
is reeling under the harsh economic conditions and political
uncertainties in the region. If that isn’t enough, the company is
wrestling with the government over permits.
The cabinet has approved the long-awaited privatization bill. A sell-off
of state-run assets could cut the debt by 30%, but it’s unclear how
privatization will be handled, or if it actually happens.
The country’s two cellular telephone operators, LibanCell and
Cellis, have their own reasons for worry. The government, claiming
the companies have breached their contracts, has ordered each
to pay a $300 million penalty or risk having their contracts canceled.
LibanPost, which began pumping new life into the country’s faltering
postal system over a year and a half ago, is also facing a barrage
of difficulties.
This month’s cover story examines the effects of the Israeli withdrawal
on the economy. Peace and stability following the pullout
could bring untold benefits. But if there is violence, the results could
be devastating.
All around, there are uncertainties in Lebanon, and uncertainty is
the enemy of economic development. Some matters, like what will
happen following the Israeli pullout, we have little control over. But
for others, like the cellular contracts, LibanPost, and Solidere, we
do. By hassling companies that are investing in rebuilding the country
and its economy, we are telling future investors that Lebanon
is not a safe place for business. Haven’t the Israelis done enough
of that already?
