Executive Magazine https://www.executive-magazine.com Lebanon's premier economic, financial and business magazine Mon, 11 Nov 2019 09:25:02 +0000 en-US hourly 1 https://wordpress.org/?v=5.2.4 Reimagining an alternative Lebanon https://www.executive-magazine.com/lebanon-uprising/comment-lebanon-uprising/reimagining-an-alternative-lebanon https://www.executive-magazine.com/lebanon-uprising/comment-lebanon-uprising/reimagining-an-alternative-lebanon#respond Fri, 08 Nov 2019 13:31:30 +0000 http://www.executive-magazine.com/?p=24670 Reading Time: 3 minutes The unthinkable has finally happened. A stubborn sectarian system, undergirded by a peculiar postwar political economy, and sustained by institutional and disciplinary practices geared toward reproducing sectarian modes of identification and mobilization, has finally given way. This is a story that can be traced back to the mid-19th century, when the dislocations created by overlapping...

The post Reimagining an alternative Lebanon appeared first on Executive Magazine.

]]>
Reading Time: 3 minutes

The unthinkable has finally happened. A stubborn sectarian system, undergirded by a peculiar postwar political economy, and sustained by institutional and disciplinary practices geared toward reproducing sectarian modes of identification and mobilization, has finally given way.

This is a story that can be traced back to the mid-19th century, when the dislocations created by overlapping socioeconomic transformations, Ottoman reforms, and colonial penetration exploded in the kind of violence that helped institutionalize a new sectarian order in Mount Lebanon. Previously a fluid social terrain, where religious identities coexisted and cross-cut with an array of alternative socioeconomic, kin, and local identities began to solidify around mainly sectarian identities. The post-1861 Mount Lebanon order structured political incentives along mostly sectarian lines. It was later reproduced in independent Lebanon, and then consolidated in postwar Lebanon. The latter’s recycled corporate consociational power-sharing arrangement redistributed political offices within an expanded but predetermined sectarian quota, further entrenching sectarian identities and modes of political mobilization.

This political system was coupled with a rentier political economy serving the sectarian political elite’s clientelist and private interests. A ballooning public sector played an instrumental role in this postwar political economy, but so did corruption and lawlessness. All this was meant to preclude any kind of meaningful political mobilization and affiliation outside sectarian straightjackets. Sectarianism was in fact the fig leaf camouflaging otherwise political and class battles. Genuine postwar peace and reconciliation among the different Lebanese communities was a prime casualty of this postwar order.

For this postwar political economy of sectarianism to function smoothly and reproduce docile sectarian subjects entailed continuous capital inflows to finance the country’s trade and fiscal deficits, and hence pay the price of a galloping public debt created in large measure by the archipelago of clientelist networks embedded inside and outside state institutions. This was achieved, but only with the help of successive donor conferences. Between 2006 and 2010, the balance of payments recorded a cumulative surplus of $19.5 billion. By 2011, however, this balance turned negative, reaching a cumulative deficit of $18.5 billion by end July this year. It is this structural fracture that created the economic grievances that exploded on October 17,  and later developed into a cross-sectarian, cross-class, and cross-regional anti-sectarian revolution.

What we are witnessing, then, is the birth of a new “imagined community,” one that travels across regions, classes, genders, and sects.

It is a revolution that has already achieved so much in so little time. It has allowed for a reimagining of the Lebanese nation beyond top-down imposed narrow sectarian affiliations. With this comes a shift in how people define themselves as agents: not as sectarian subjects in a political order cut along sectarian and religious lines, but rather as anti- and trans-sectarian citizens operating in a polyphonic and democratic civic space, one where alternative class, gender, and environmental interests drive political action. Moreover, the October 17 revolution marks the definitive end of the civil war, and a genuine bottom-up reconciliation between one-time warring communities. This reconciliation is the beginning of elusive postwar peace and collective healing, the real bulwark against future attempts to instrumentalize sectarianism by the political economic elite for local or geopolitical purposes. What we are witnessing, then, is the birth of a new “imagined community,” to borrow Irish political scientist Benedict Anderson’s term, one that travels across regions, classes, genders, and sects. That is the greatest and undeniable achievement of this moment, one that no matter the short-term outcome, can never be reversed.

This does not mean that those sectarian communities laboriously assembled by the ideological, material, and institutional practices of the sectarian system will wither away anytime soon—despite the drying up of the clientelist swamps. They are numbed by the ideological hegemony of the sectarian system and nourished on the demonizing discourse of sectarian entrepreneurs. They are also scared lest they lose whatever material interests remain vested in the sectarian system. But they are undeniably running against the long play
of history. 

Ultimately, and despite the inescapable violence exercised against them, it is this nascent anti-sectarian community composed principally of Generation Zs who will, by peaceful and democratic practice, demonstrate to those lingering sectarian communities that, to borrow from  French poet and politician Aimé Césaire, there is “a place for all at the rendezvous of victory” in the long battle for an alternative Lebanon.

The post Reimagining an alternative Lebanon appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/lebanon-uprising/comment-lebanon-uprising/reimagining-an-alternative-lebanon/feed 0
A perspective on the solutions offered in last-ditch efforts of old government https://www.executive-magazine.com/lebanon-uprising/reforms/a-perspective-on-the-solutions-offered-in-last-ditch-efforts-of-old-government https://www.executive-magazine.com/lebanon-uprising/reforms/a-perspective-on-the-solutions-offered-in-last-ditch-efforts-of-old-government#respond Fri, 08 Nov 2019 13:18:25 +0000 http://www.executive-magazine.com/?p=24648 Reading Time: 8 minutes The government’s economic rescue plan has been rendered theoretical. The political context of its presentation reveals real dimension of governance failings in the past two years. Analysis of the plan’s composition shows it to be disparate and desperate. Economic reality will require huge efforts beyond the scope of the last plan. What to do with...

The post A perspective on the solutions offered in last-ditch efforts of old government appeared first on Executive Magazine.

]]>
Reading Time: 8 minutes

  • The government’s economic rescue plan has been rendered theoretical.
  • The political context of its presentation reveals real dimension of governance failings in the past two years.
  • Analysis of the plan’s composition shows it to be disparate and desperate.
  • Economic reality will require huge efforts beyond the scope of the last plan.

What to do with the political products of October 2019, most prominently the 2020 budget draft approved on October 21, and the economic rescue plan that then-Prime Minister Saad Hariri presented on the same day? Having arrived alongside the total novelty of a budget draft that was completed and properly signed within the constitutional time frame, the plan for national economic rescue efforts by the cabinet miraculously appeared after a mere 72 hours of negotiation.

However, just over a week later the plan was pulled with the cabinet’s resignation. Is it now a curio for academic study on whether it could have worked? Or, on the basis—by no means certain—that there will be a near-term formation of a new, more ethical, and more technocratic government, could the plan assist in and speed up the desperate search for necessary economic solutions?

The first thing that becomes obvious from examining this plan is that it was not an instantaneous creation. Many of its components are awfully familiar as either proposals that have their roots in the early Hariri era—over two decades ago—or as cabinet projects that have been negotiated back and forth at the Grand Serail in the past two years, falling victim to obstructionism. But as comforting as it is that these ideas were not just pulled out of thin air, the downside is that this is irrefutable evidence that political factors allowed the economy to worsen over the past two years.

Beyond endurance

While everyone was paying lip service at the bedside of the ailing Lebanese economy it was edging nearer to total monetary paralysis and asphyxiation that could have been prevented through concerted resuscitation measures by politicians. The demand for a rescue agreement and its last-hour presentation points to the reasons for the underlying and maddening inertia of the now resigned government.

To quote Hariri’s speech on October 18: “I have been trying for three years to treat its reasons and find real solutions. For more than three years, I told all our partners in Lebanon that our country has been exposed to circumstances beyond its will and is spending, year after year, more than its income. The debt has become so great that we can no longer endure.”

The existence of political obstructionism in this government was no secret, and Hariri previously publicly expressed that he would be able to achieve wonders if crucial initiatives only could proceed unimpeded. It was also obvious that his purported unity government was an arena of badly conflicting interests. But it was still shocking to confirm the utter lack of rational self-interest in the ruling class. Learning that zero trust was the only thing that this government deserved—from beginning to end—adds more pain to having seen Lebanon stumble so deliriously through the last 17 months.

Secondly, while Hariri has throughout his political career raised the eyebrows of both opponents and non-partisan observers through his actions and indecisions, his last ditch efforts to produce an economic plan and his speech announcing his intention to resign showed a strength of character often criticized as lacking. But still it seems he was not able to acquire all of the requisite strength and decisiveness needed to lead in the Lebanese arena of never-ending political conflicts.

He noted in his October 18 speech: “As I tried to implement [CEDRE], I encountered all types of obstacles, starting from the formation of government that took weeks, months, and seasons!” Referencing obstructionism three separate times, Hariri said that at the end of efforts to reach an agreement on approaches to the electricity file, deficit reduction, and reform of administrative bodies, each time “someone came and said: ‘This cannot work.’”

Thus, context-wise, the October 18 speech demonstrates both the lack of any sense of national responsibility among an unknown number—likely an absolute majority—of the ruling class, and weaknesses in leadership that did not allow for success despite intense and sincere efforts. Content-wise, however, the question remains if the plan could be used as a blueprint for the next government as a last, post-post deadline effort to pull the economy out of its desperate situation.

The topline impression of the list of measures presented by Hariri on October 21 is not one of a strategically focused plan, but a garage sale of reform, revenue, and cost-cutting propositions. In Hariri’s own description, what he presented was not an economic plan, but an agreement with his partners in government on the “minimum necessary actions” that have been needed these past two years.

Counter-intuitive

The list that Hariri read out entails 17 points, the first of which directly gives the appearance of insincere grandstanding by trumpeting two counter-intuitive messages—that there will be no new taxes but a fantastic numerical reduction in the deficit to 0.6 percent. This means a target of wanting to almost eliminate the deficit in a single leap by an even larger margin—some 700 basis points from 7.6 to 0.6 percent than in the 2019 budget, where the target of deficit reduction by around 400 basis points was met with disbelief by the international financial community. Notably here, the CEDRE agreement stipulated a commitment to a—regarded then as difficult but doable—reduction of 100 basis points per year.

In the further array of budgetary and non-budgetary measures that Hariri presented, one cost reduction target referred to lowering the EDL-related deficit by a LL1 trillion (over $660 million). Three additional points in the list relate to cost cutting, most eye-catchingly via a 50 percent reduction in salaries and retirement benefits of top-tier public servants, but also through 70 percent reduction of allocations to institutions such as the Council for Development and Reconstruction, the Central Fund for the Displaced, and the Council for the South, plus the abolition of superfluous public sector institutions, beginning with the Ministry of Information.

On the revenue and investment side, the most prominent point high up in the list refers to financial sector contributions and support for the state finances to the tune of $3.3 billion, besides allusions to activation of the first phase of CEDRE disbursements, foreign investment, and social loans, as well as laws that will facilitate recouping looted public funds. The feasibility of the core revenue proposition involving the central bank and the commercial banking sector is an invitation for comments (most of which would have yet to be made) ranging from technical and legal questions to discussions of ethics, fairness, and economic effectiveness.

The list that Hariri read out entails 17 points, the first of which directly gives the appearance of insincere grandstanding by trumpeting two counter-intuitive messages.

Two other points in the list point to projects that imply cost reductions and revenue increases with somewhat delayed impact, but also appear to require immediate funding—namely speeding up tenders for the construction of power plants and installing border scanners to combat smuggling and improve customs revenues.


There are also mentions of popular legislative projects such as the amnesty law, the afore cited draft law for recovery of looted money, a law to establish the national anti-corruption commission in the near future (it was passed by Parliament in July but was returned by President Aoun with 11 objections), and an agreement on enabling independent regulatory authorities by appointing their boards. Social measures in the list entail an allocation of $160 million in support of housing loans, the institution of a pension fund, and the allocation of LL20 billion and a World Bank concessional loan of $100 million to the National Poverty Targeting Program.

The final numbered point in the 17-point list mysteriously resurrects project names Linord and Elyssar. These were two large urban development and housing projects that were once introduced by Rafik Hariri (and were alluded to by Saad Hariri in an investment forum at the end of 2018) but have long vanished from research focuses and have not recently appeared in concepts like the McKinsey Lebanon Economic Vision, an October 2019 whitepaper by the Lebanese International Financial Executives, nor mentioned by civil society and economic stakeholders in their comments on Executive’s Economic Roadmap project.

Hariri concluded his presentation with a reference to the intention to privatize the mobile communications operators Mic 1 and Mic 2, and an assertion that there is “a complete change of mentality in this budget. Investment spending from the budget is almost zero, thus closing the door on squander and corruption because the government does not spend a penny. The entire expenditure is from foreign investment.”

Notably, measures discussed in the final weeks of this cabinet went beyond the points that Hariri touched upon on October 21. If the analysis is widened to cabinet statements circulated by the prime minister’s press office on October 16, 17, and 18, measures communicated then to the media by Minister of Information Jamal Jarrah, the list of measures and propositions extends first of all to the infamous Voice over Internet Protocol (VoIP) fee proposal, dubbed the WhatsApp tax and referred to on October 17 as having a projected revenue potential of $250 million annually. This VoIP fee was renounced the same day protests began, but sparked protests that ended up damaging and depriving the Lebanese economy of revenues to the magnitude of more than a billion dollars (some unconfirmed estimates said $100 million a day).

A bit less spectacular, but not entirely free of problems were the measures Jarrah announced on October 16, namely a decision by the Ministry of Finance to increase fees on tobacco products, the above mentioned installation of scanners at border points, a decision for all investment decisions by public institutions and utilities to need cabinet approval, and an agreement on “the principle of corporatization” for the Port of Beirut and other, not specified institutions. He also reported on cabinet discussions that were related to taking an inventory of state-owned real estate, a three-year investment program related to CEDRE and the Capital Investments Plan, the pension law (as referenced by Hariri on October 21), and a proposed 5 percent subsidy to industrial exporters that would be paid on the amount by which they increased their exports from year to year.

Too many unknowns

In the October 18 speech, in which Hariri gave his government colleagues 72 hours to come up with solutions, the prime minister explicitly referred again to the need to alleviate the burden of electricity subsidies, and implement the electricity plan and CEDRE process. On that day, and again on October 21, Hariri’s list was high-level and broad, factors that do not favor a quick analysis of its diverse content—the same is true for some of the measures announced previously by Jarrah. Yet, it is difficult to shake the impression that the government’s search for solutions since days before and throughout the protests was frantic, but not ordered strategically.
It remains at the end of a brief review of the government’s October reform deliberations unknown whether the debt, the entrenched high trade deficit, underdeveloped industrial productivity, shortfalls in international competitiveness, insufficient capital markets, poor financial inclusion, growing economic informality, weakness of redistributive justice and direct taxation and plutocratic patterns that are as bad as those in the most capitalist countries could be cut if only the iron bonds around the knot, the systemic bonds of clientelism, sectarianism, and corruption, are broken.

It is difficult to shake the impression that the government’s search for solutions since days before and throughout the protests was frantic, but not ordered strategically.

In recent months, there have been other narratives put on the table than the narratives of austerity, increased taxation of functioning and fiscally more transparent sectors, notably banking, and total abstinence from own investment risk by the government. There has been some progress but no results yet in areas of privatization, public-private partnerships, and activation of capital markets. The concept of an Electronic Trading Platform and invigoration of capital markets has excessively been referenced as crucial means to improve the transfer of private and non-productive savings into hitherto state-owned and affiliate enterprises, such as the flag carrier Middle East Airlines and the telecommunications sector (where privatization and license auction concepts have been tossed around for two decades). Banking leaders have presented their views on the importance of banks’ ability to finance private and public sectors by not being unfairly taxed. There has been enough said to provide a platform for serious, non-ideological discussion that is neither sectarian nor ignorant nor based on obviously partisan and self-interest narratives of self-righteous and narrow interest groups—communal, sectarian, economic, political, or civil society.

Despite all new or previous economic planning, up to the Hariri economic rescue plan from October 21, it remains uncertain what way will work best out of this incredibly deep mess, and it is an equally open critical question if the economy of Lebanon can be rescued by an immediate switch to governance by persons with peak theoretical knowledge and expertise but no wide political experience, or people of great technical training who did not have to previously face the opportunity and temptation to become corrupt.

The post A perspective on the solutions offered in last-ditch efforts of old government appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/lebanon-uprising/reforms/a-perspective-on-the-solutions-offered-in-last-ditch-efforts-of-old-government/feed 0
Uprising https://www.executive-magazine.com/lebanon-uprising/photo-blog-lebanon-uprising/uprising https://www.executive-magazine.com/lebanon-uprising/photo-blog-lebanon-uprising/uprising#respond Fri, 08 Nov 2019 11:29:03 +0000 http://www.executive-magazine.com/?p=24607 Reading Time: 2 minutes October 17: Protesters set fire in Downtown on Thursday on the first day of the revolts.  October 18: Demonstrations continued with protestors closing roads in downtown.  October 20: Sunday’s protest was the largest gathering in Downtown since February 2005.  October 22: This photo depicts elements of an open air carnival in Riad el-Solh.  October 23:...

The post Uprising appeared first on Executive Magazine.

]]>
Reading Time: 2 minutes

The post Uprising appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/lebanon-uprising/photo-blog-lebanon-uprising/uprising/feed 0
Collective actions in Lebanon from November 2017 to October 25, 2019 https://www.executive-magazine.com/lebanon-uprising/explainer-lebanon-uprising/collective-actions-in-lebanon-from-november-2017-to-october-25-2019 https://www.executive-magazine.com/lebanon-uprising/explainer-lebanon-uprising/collective-actions-in-lebanon-from-november-2017-to-october-25-2019#respond Fri, 08 Nov 2019 10:57:20 +0000 http://www.executive-magazine.com/?p=24593 Reading Time: 2 minutes The infographic below is based on data from the Map of Collective Actions that tracks mobilizations by groups of people across Lebanon whose goal is to achieve a common objective. The map is a project by Lebanon Support, a local non-profit research center for and about civil society. This visual looks into the build- up...

The post Collective actions in Lebanon from November 2017 to October 25, 2019 appeared first on Executive Magazine.

]]>
Reading Time: 2 minutes

The infographic below is based on data from the Map of Collective Actions that tracks mobilizations by groups of people across Lebanon whose goal is to achieve a common objective. The map is a project by Lebanon Support, a local non-profit research center for and about civil society.

This visual looks into the build- up of mobilizations from November 2017 (when data collection started) until October 25, highlighting the focus of protests on access to socio-economic rights (mobilizations related to a lack of protection and rights, inefficiency of the justice system, and persisting social and economic vulnerabilities) over the years and leading up to the October demands for change.

The infographic shows that these ongoing nationwide protests are not new—various groups have been mobilizing for years, notably around social and economic demands. This year, up until October 16, 200 collective actions were mapped; there were 188 in 2018 and 96 in 2017. The main demands, across all three years, were focused on wages and the salary scale, the new rent law, and increasing prices and inflation—illustrating the socioeconomic difficulties faced by the people. Of the collective actions mapped this year, 89 percent (508 collective actions) were linked to access to socioeconomic rights. Collective actions linked to socioeconomic grievances have increased steadily and exponentially from 2017 until October 25 this year (the cut-off point for the infographic). The October 17 to 25 period highlighted below saw a sudden peak in collective actions seeking radical change on the level of society or the political system.

The 308 collective actions mapped between October 17 and 25 are all linked to socioeconomic grievances and policy grievances (mobilizations around political decisions on matters of public concern), and constitute 60 percent of the total number of collective actions mapped since the beginning of the year. Bearing in mind that protesters often employed more than one mode of action during the same mobilization, the main modes of action in this period consisted of: roadblocks (76 percent), tire burning (68 percent), demonstrations (60 percent), and sit-ins (38 percent).

Observing and mapping collective actions over a longer period allows Lebanon Support to deconstruct generalizations in the media, academia, and elsewhere on Lebanon’s social mobilizations and show that people in Lebanon are continuously mobilizing, using various modes of action, and in response to a diversity of grievances not merely limited to partisan and/or confessional affiliations.

Based on Lebanon Support’s ongoing monitoring of collective actions, this infographic contributes to show the accumulation of successive movements over time, thus steering away from normative and linear perspectives on these mobilizations and predictions or expectations on the outcomes of protests. So far, one of the main outcomes and breakthroughs of this latest mobilization is that it has contributed to breaking the boundaries of fear and clientelistic and patronage relations with traditional sectarian and political leaders, notably outside of the capital (in Tripoli and Sour, for example).

Ultimately, it is the view of Lebanon Support that all these street mobilizations underline the urgency of a new social contract whereby citizens reclaim the Lebanese state. One that is based on social justice, redistributive policies, and progressive taxes.

Click on image to enlarge

The post Collective actions in Lebanon from November 2017 to October 25, 2019 appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/lebanon-uprising/explainer-lebanon-uprising/collective-actions-in-lebanon-from-november-2017-to-october-25-2019/feed 0
The first 13 days https://www.executive-magazine.com/lebanon-uprising/timeline/the-first-13-days https://www.executive-magazine.com/lebanon-uprising/timeline/the-first-13-days#respond Thu, 07 Nov 2019 14:12:45 +0000 http://www.executive-magazine.com/?p=24557 Reading Time: 11 minutes Day 1: Thursday, October 17 Protests erupt across the country Protests begin in Downtown Beirut around 6 p.m., triggered by media reports earlier Thursday that cabinet had agreed on new taxes for the 2020 budget, including a tax on Voice over Internet Protocols (VoIP) that would have cost up to $6 per month for those...

The post The first 13 days appeared first on Executive Magazine.

]]>
Reading Time: 11 minutes

Day 1: Thursday, October 17

Protests erupt across the country

Protests begin in Downtown Beirut around 6 p.m., triggered by media reports earlier Thursday that cabinet had agreed on new taxes for the 2020 budget, including a tax on Voice over Internet Protocols (VoIP) that would have cost up to $6 per month for those using WhatApp calls or other VoIP apps. 

Initially, a few hundred protesters march from Downtown to Hamra and back to Riad el-Solh. As the news spreads, their numbers swell into the thousands. Clashes between protesters and bodyguards of Minister of Education and Higher Education Akram Chehayeb break out in front of Bank Audi in Downtown, with the bodyguards firing shots into the air. The photo that becomes the first icon of the protests is taken as protester Malak Alaywe kicks one of Chehayeb’s armed bodyguards in the groin. 

Reports begin to come in of spontaneous protests breaking out across the country, from Tripoli in the north to Sour in the south. Protesters burn tires, create bonfires, and block roads. Two Syrian migrant workers are killed after the Downtown Beirut building they are in is set alight. The government reverses their decision on theVoIP tax, but this response does not quell the protests. Progressive Socialist Party head Walid Jumblatt tells local media he would prefer to quit the government with Prime Minister Saad Hariri. 

Protests continue until the early hours of Friday morning when security forces start firing tear gas and protesters move out of Riad el-Solh and Martyr’s Square.

Protests and roadblocks in: Beirut (BCD), Tripoli (Tripoli), Saida (Saida), Zahle (Zahle, Chtaura,Taalabaya), Jbeil (Jbeil), Keserwan (Zouk Mosbeh), Baalbek (Baalbek), Sour (Sour), Nabatieh (Nabatieh el-Faouqa)*

Day 2: Friday, October 18

Protests shut down Lebanon, Hariri announces 72-hour deadline for reforms

Just after midnight, the education minister orders all schools and universities to close Friday. Lebanese wake up to find roadblocks paralyzing movement across the country and all banks closed. The airport highway is blocked by protesters, and travelers hitch rides into the city on the back of scooters or in army trucks. Activists call for a general strike. 

Both Jumblatt and Lebanese Forces leader Samir Geagea call on Hariri to resign. A cabinet meeting planned for the afternoon is canceled. Gebran Bassil, leader of the Free Patriotic Movement (FPM) and foreign minister, speaks in advance of Hariri, says that the choice is chaos or reforms. Hariri speaks around 6:40 p.m. amid rumors circulating social media that he might resign. Instead he sets a 72-hour deadline for his political partners to convince him, the Lebanese, and the international community of reforms. Hariri warns that if there are no agreed upon reforms by the deadline he will take a different approach. 

Protests continue to intensify across the country. In Tripoli, local media reports two dead and others are wounded after bodyguards of former MP Misbah al-Ahdab shot into the crowd. Ahdab had tried to join the protests but had been pelted by water bottles from the crowd. In the south, there are chants, unprecedented in the region, calling Speaker Nabih Berri a thief. 

Security forces clear Riad el-Solh much earlier than on the previous day, around 11 p.m. Copious amounts of tear gas are used in the square, with women, children, and peaceful protesters still there. Reports say that the Lebanese Army and Internal Security Forces (ISF) use force against protesters and arrest dozens. A concertina wire fence is put up blocking the Grand Serail from Riad el-Solh. It is announced that banks are to remain closed Saturday.

Protests and roadblocks in: Beirut (BCD),Tripoli (Tripoli), Metn (Daoura, Sin el-Fil), Zahle (Chtaura, Zahle), Jbeil (Jbeil), Keserwan (Aqaybe, Zouk Mosbeh),Saida (Saida), Baalbek (Baalbek, Britel, Rayak), Nabatieh (Nabatieh el-Faouqa), Aley (Bhamdoun el-Mhatta, Masnaa), Shouf (Jiyeh

Day 3 Saturday, October 19

Protests continue to grow, with violence in Sour; Nasrallah backs cabinet

n Beirut to clean up damage caused by rioting the evening before. Reports come in that armed Amal supporters are violently attacking protesters in Sour, in response to anti-Berri chants and protests at the office of two Amal MPs. Al-Jadeed TV receives direct threats. In Tripoli, protesters begin chanting in solidarity with protesters down south. 

Hezbollah Secretary General Hassan Nashrallah addresses his followers and those out protesting. He warns against the resignation of the government and says that reforms must be made by the current government as Lebanon cannot afford the time to form a new one. He also says if Hezbollah were to join the protests they would be forced to stay until all their demands are met. Responding to his speech, protesters in Riad el-Solh begin chanting, “All of them means all of them, and Nasrallah is one of them.”

Lebanese Forces announces the resignation of its four ministers, marking the first tangible success of protesters’ demands. 

In Beirut, the atmosphere of protests shifts as families increasingly join in the crowd, tents and food stands are set up in Martyr’s Square, and DJs play techno sets.  

Protests and roadblocks in: Beirut (BCD), Tripoli (Tripoli, Mina), Metn (Daoura, Sin el-Fil, Jal el-Dib), Saida (Saida, Zahrani), Jbeil (Jbeil), Keserwan (Adonis Keserwan), Sour (Sour), Nabatieh (Nabatieh el-Faouqa, Nabatieh el-Tahta, Habbouch, Kfar Roummane), Aley (Khalde, Aramoun, Bchamoun, Qubbat Choueifat, Kahaleh), Shouf (Deir el-Qamar, Jiyeh, Ketermaya), Zahle (Chtaura), Batroun (Batroun, Chekka, Hamat), Akkar (Halba), Marjaayoun (Marjaayoun), Zgharta (Zgharta), Baabda (Ouzai, Chiyeh), Koura (Kousba, Anfeh, Dahr al-Ain, Kfar Hazir, Amioun), Hasbaya (Hasbaya), Hermel (Hermel

Day 4: Sunday, October 20

Huge turnout for protests as more families head to the streets

Hundreds of thousands of protesters across the country express their will and frustration on the streets and major squares in various cities; some media estimates put the overall number at close to 1 million. This is the largest day so far for these protests, which maintain a national, non-sectarian character—only Lebanese flags are waved. 

Some of the largest crowds, found in Martyr’s Square and Riad el-Solh, are compared to the March 2005 protests in which protesters called for the end of Syrian presence in Lebanon. In Tripoli, thousands flock to Nour Square, where Lebanese singer Marcel Khalife joins protesters in singing some of his songs. Buses transport protesters from the Bekaa to Beirut. In Jal el-Dib, hundreds of protesters begin to gather on the main highway and the overpass, with the crowd swelling throughout the day. 

Roadblocks are maintained across the country. 

Protests and roadblocks in: Beirut (BCD, Ashrafieh), Tripoli (Tripoli), Metn (Jal el-Dib), Saida (Maghdousheh, Saida, Zahrani), Zahle (Zahle, Rayak), Keserwan (Adonis Keserwan, Ghazir), Baalbek (Nabi Osamane), Sour (Sour, Abbassieh), Nabatieh (Kfar Roummane, Nabatieh el-Tahta), Shouf (Jiyeh, Deir el-Qamar, Baakline, Kfar Him), Batroun (Chekka), Akkar (Halba, Zouk el-Hosniye), Marjaayoun (Deir Mimas), Koura (Kousba, Kfar Hazir, Bsarma, Kfar Aaqqa), Minieh-Danieh (Beddawi

Day 5: Monday, October 21

Hariri announces reforms, protests and roadblocks continue

The first day of reckoning for the political establishment arrives, as Hariri’s 72-hour deadline draws to a close. Early in the morning, protesters once again return to Downtown Beirut to clean up from the night before. Protests throughout the weekend had drawn large crowds, but numbers in Beirut on Monday do not pick up until after 5 p.m., in spite of renewed calls for a general strike. Access to Beirut via main highways is severely restricted as roadblocks continue. 

Around 3 p.m., Hariri announces a list of 17 reforms approved by cabinet that propose to cut the deficit and expedite long overdue administrative reforms without increasing taxes on the people. Protesters, who had called for Hariri’s resignation, are unconvinced, and demonstrations swell in size across Lebanon following Hariri’s speech.

In the evening, a convoy of men on mopeds carrying Amal and Hezbollah flags make their way toward Downtown but are prevented from reaching the protests by the Lebanese Army. Both Amal and Hezbollah later deny having any involvement.

Protests and roadblocks in: Beirut (BCD, Saifi), Tripoli (Tripoli), Metn (Sin el-Fil, Jal el-Dib), Saida (Ghaziyeh, Saida, Zahrani), Zahle (Rayak, Zahle el-Midan), Jbeil (Jbeil), Keserwan (Jeita, Achkout, Zouk Mosbeh, Bouar), Baalbek (Douris), Nabatieh (Kfar Roummane, Habbouch), Aley (Choueifat Qubbat, Bchamoun, Aramoun), Shouf (Jiyeh), Batroun (Chekka, Batroun), Akkar (Halba), Marjaayoun (Deir Mimas, Marjaayoun), Zgharta (Zgharta), Baabda (Bir Hassan), Koura (Kfar Hazir, Anfe), Hasbaiya (Hasbaiya), Rachaya (Rachaya el-Wadi, Deir el-Ahmar), Minieh-Dinieh (Minieh)

Day 6: Tuesday, October 22

Slow start but protests pick up, Tele Liban stormed, NNA head fired

Protests are slow to start, but pick up in the evening as people got off work and hit the streets. As the day goes on, hundreds block the street facing Banque du Liban (BDL), Lebanon’s central bank, chanting that Central Bank Governor Riad Salameh is a thief; similar protests are staged in front of Tripoli’s central bank branch. A group of actors and artists storm the Tele Liban building, saying the station had failed to cover the demonstrations. 

The National News Agency (NNA) Director Laure Sleiman, who headed the NNA for 11 years, is dismissed. Minister of Information Jamal Jarrah appoints Ziad Harfoush as the new director of the NNA. The Ministry of Information, which the NNA falls under, is set to be abolished per Hariri’s basket of reforms. 

Protests and roadblocks in: Beirut (BCD, Mazraa, Hamra),Tripoli (Tripoli), Metn (Jal el-Dib, Dbayeh), Saida (Saida), Zahle (Zahle el-Midan, Masnaa), Keserwan (Nahr el-Kalb, Jounieh Kaslik, Ghazir, Safra, Zouk Mkayel, Aachqout, Jeita), Nabatieh (Kfar Roummane), Aley (Aley, Bhamdoun el-Mhatta, Sofar, Bhamdoun), Shouf (Jiyeh, Barja, Naame, Aalma el-Shouf), Batroun (Batroun, Chekka), Akkar (Halba), Koura (Majdel Koura, Anfe, Kousba), Sour (Sour), Hermel (Hermel), Minieh-Dinieh (Beddawi, Minieh) 

Day 7: Wednesday, October 23

Protests in Nabatieh turn violent

As their first week draws to its close, protests do not abate, and in Nabatieh turn violent, leaving 15 injured; one is taken to the intensive care unit. Amal denies any involvement in the clashes. In Beirut, protests in front of the central bank continue. 

Separately, Mount Lebanon State Prosecutor Ghada Aoun files an “illegitimate enrichment through subsidized housing loans” lawsuit against Bank Audi and former Prime Minister Najib Mikati, his son Maher, and his nephew Azmi, saying that she had the file prepared beforehand and that this move was not politically motivated. Mikati and Bank Audi deny “illegitimate enrichment” allegations against them.

Meanwhile, Hariri meets with Salameh over the financial and economic situation. Hariri also chairs a meeting of the ministerial committee in charge of financial and economic reforms. The committee studies a draft law on the recovery of looted public money and decides to request suggestions on this matter from the Supreme Judicial Council within a period of 10 days, NNA reported. 

Protests and roadblocks in: Beirut (BCD, Hamra, Ashrafieh), Metn (Sin el-Fil, Dbayeh, Jal el-Dib), Saida (Saida), Zahle (Zahle), Jbeil (Jbeil), Keserwan (Jounieh Kaslik, Jeita, Nahr el-Kalb, Bouar, Safra, Aachqout, Zouk Mkayel), Baalbek (Baalbek), Sour (Sour), Nabatieh (Habbouch), Aley (Aley, Bhamdoun al-Dayaa, Bchamoun, Choueifat, Khalde), Shouf (Naame, Jiyeh, Bhamdoun), Batroun (Heri, Chekka), Akkar (Halba), Zgharta (Zgharta), Baabda (Furn el-Chebbak), Koura (Kousba, Anfe, Kfar Hazir), Hermel (Hermel), Minieh-Dinieh (Minieh, Kharroub

Day 8: Thursday, October 24

Aoun addresses the nation

Having been silent for the first week of protests, President Michel Aoun addresses the nation, announcing that he will hold everyone who embezzled public funds accountable and that economic reform will save Lebanon. He also says that he is ready for “constructive dialogue” with representatives from the protest movement, which remains leaderless. His speech, which was pre-recorded, falls on deaf ears as protesters continue to occupy the streets. Key thoroughfares in and outside of Beirut remain closed, despite some scuffles between the army and protesters as the former attempts to reopen them. Videos of soldiers crying in Jal el-Dib circulate on social media. 

In Riad el-Solh, six protesters are taken to the hospital following clashes between members of a pro-Hezbollah group and anti-government protesters, according to the Lebanese Red Cross. 

The Association of Lebanese Banks (ABL) announces that banks will reopen as soon as the situation stabilizes. Schools and universities remain closed; some professors teach classes in public spaces. 

Following the Wednesday clashes between protesters and Nabatieh municipal police, five members of the Nabatieh Municipal Council announce their resignation. One member, Abbas Wehbi, says in a statement that he is against the “inhumane treatment of protesters.”

Protests and roadblocks in: Beirut (BCD, Ashrafieh, Mazraa, Ras el-Nabaa, Hamra, Ain el-Tineh), Tripoli (Tripoli), Saida (Saida), Metn (Jal el-Dib, Mkalles, Dbayeh), Zahle (Bar Elias, Saadneyel, Jdita), Keserwan (Zouk Mosbeh, Ghazir, Safra, Aqaybeh, Bouar), Sour (Sour), Nabatieh (Nabatieh el-Faouqa, Habboush), Aley (Sofar, Mansourieh, Khalde), Shouf (Barja, Jiye, Kfar Him, Beittdine, Naame), Batroun (Batroun), Baabda (Furn el-Chebbak, Aabadiyeh, Dahr el-Baidar), Minieh-Dinieh (Beddawi, Minieh)

Day 9: Friday, October 25

Nasrallah speaks for a second time, questions protesters’ motives

As protests continue across the country, Nasrallah speaks again, saying he refuses to accept the resignation of the government. In his speech, Nasrallah warns the country of a civil war and claims his intelligence services found evidence that the protests were being orchestrated and funded by certain embassies with hidden agendas. 

Hariri meets with Aoun and tweets: “I called the president of the republic and welcomed his call for the need to reconsider the current government situation through the constitutional mechanisms.”

Nasrallah calls for roads to be unblocked, but protesters are not swayed and remain in the streets despite aggression from Hezbollah supporters in areas including Sour, Nabatieh, and Riad el-Solh prior to Nasrallah’s speech. Chants in Hermel in the north demonstrate solidarity with their fellow Lebanese in the south. Meanwhile, supporters of FPM chief Bassil and President Aoun gather in Batroun amid army and security forces’ deployment and call for restoration of looted public funds. In Al-Fakiha in Lebanon’s east, protesters square off with Hezbollah supporters before riot police intervene.

Boxes are set up by civil society groups and some media outlets at protest sights for people to write down their demands. The Standard & Poor’s ratings agency puts Lebanon on “CreditWatch negative” warning that decline in foreign currency inflows “could exacerbate fiscal and monetary pressures.”

Protests and roadblocks in: Beirut (Ashrafieh, BCD, Hamra, Saifi), Metn (Jal el-Dib), Mazraat Yachouh), Saida (Saida, Zahrani), Zahle (Zahle, Bar Elias, Saadnayel, Jdita), Keserwan (Zouk Mkayel, Safra, Bouar), Baalbek (Douris), Sour (Sour), Akkar (Halba), Nabatieh (Habbouch, Kfar Roummane, Nabatieh el-Faouqa), Aley (Choueifat, Aley, Khalde, Aramoun),Shouf (Jiyeh, Naame, Barja, Sibline), Batroun (Batroun, Chekka), Zgharta (Zgharta), Baabda (Furn el-Chebbak, Dahr el-Baidar, Aabadiyeh), Minieh-Dinieh (Minieh, Beddawi)

Day 11: Sunday, October 27

Lebanese form a human chain across the country

A 171-kilometer “Lebanese Human Chain” is formed across the country, from north to south, by tens of thousands of Lebanese in an expressed manifestation of national unity. By around 3 p.m., the chain is complete, and despite some gaps, pictures of a manoushe that made it from north to south circulate on social media. Protesters move toward the public squares in Beirut, Tripoli, Saida, Sour, Nabatieh, Jal el-Dib, and Zouk Mosbeh, as well as in the Bekaa Valley and other areas across the country. Hundreds of Lebanese diaspora gather in cities like Sydney, London, and Montreal to show solidarity with the uprisings in their home areas. 

Sunday evening sees the closure of the ring again, this time with protesters bringing in couches, rugs, a refrigerator, and a desk to set up camp.

Lebanon’s Public Prosecutor Judge Ghassan Ouiedat issues an order banning traders and money exchangers from transporting significant amounts of dollars across borders out of Lebanon.

Protests and roadblocks in: Beirut (Ashrafieh, BCD, Hamra, Corniche el-Nahr), Tripoli (Tripoli), Metn (Jal el-Dib, Dbayeh, Sin el-Fil), Saida (Saida), Zahle (Jdita), Jbeil (Jbeil, Nahr Ibrahim), Keserwan (Safra, Ghazir, Aaqaybe, Zouq Mkayel, Nahr el-Kalb, Jounieh Kaslik), Nabatieh (Kfar Roummane), Aley (Aley), Shouf (Barja, Naame), Batroun (Batroun, Chekka, Kfar Aabida), Akkar (Halba, Abde), Baabda (Tahouita, Aabadiyeh), Koura (Kfar Hazir, Kfar Aaqqa), Hasbaiya (Hasbaiya), Minieh-Dinieh (Beddawi), Jezzine (Aarqoub), Bint Jbeil (Bint Jbeil)

Day 12: Monday, October 28

Rain does not quell protests, Jal el-Dib highway blocked by cars

With storms across Lebanon, protest turnouts are smaller than they had been previously when weather conditions had been mostly sunny, however, significant numbers are still out braving the storm. In Riad el-Solh, a group of protesters in ponchos dance the dabke in the downpour. A small group of protesters crosses the barrier of barbed wire that separates Riad el-Solh from the Grand Serail; they quickly return to the main square. 

Riot police are more heavily deployed to the area, and more protesters show up in the square later in the day. 

Roads throughout the country remain blocked with cars, tires, and protesters holding intersections. An image circulated on social media and in WhatsApp groups encouraging people to use their cars to block roads after increased efforts from security forces to keep them open. The furniture blockade on the ring continues, with protesters diverting traffic toward Ashrafieh off the bridge. Police presence remains heavy in Downtown.

The lift on banking secrecy of FPM ministers and MPs is implemented.

Protests and roadblocks in: Beirut (Hamra, BCD, Saifi, Ashrafieh), Tripoli (Tripoli), Metn (Jal el-Dib, Dbayeh) , Saida (Saida), Zahle (Saadnayel, Zahle), Keserwan (Zouk Mosbeh, Ghazir), Baalbek (Baalbek), Nabatieh (Nabatieh), Aley (Khalde), Shouf (Jiyeh, Naameh, Deir el-Qamar), Batroun (Chekka, Batroun), Akkar (Halba), Baabda (Furn el-Chebbak), Koura (Kfar Hazir), Minieh-Dennieh (Minieh)

Day 13: Tuesday, October 29

Hariri resigns “in response to the will and demand of the thousands of Lebanese demanding change;” violence on the ring and in Downtown

The prime minister’s office of announces that Hariri will deliver a statement at 4 pm. An hour ahead of the address, Hezbollah and Amal affiliates incite unprovoked violent clashes against protesters. Their aggressions target foreign and local journalists and camera crews. Journalists and photographers covering the events say that riot police and army intervened only with delay to separate the attackers and protesters. The group of attackers, shouting slogans that identify them as Hezbollah and Amal supporters, moves on to Riad el-Solh and Martyr’s Square, attacking people with sticks and pipes and destroying the tents and infrastructure that protesters had set up, while security forces watch but do not intervene. When police and military later establish commanding presence and disperse the anti-protest group under use of tear gas, protesters return to clean up tents, and one group sets up a table to hand out food to those working to rebuild the protest camp. 

Just after 4 p.m., nearly two weeks into protests that have gripped the entire nation, Hariri announces his resignation in a live address; under the Lebanese constitution this means the resignation of the entire cabinet. He quotes his father, the late Prime Minister Rafik Hariri by saying, “No one is above his nation.” Afterwards he heads to Baabda Place and hands his written resignation to President Aoun, who accepts and the next day issues a decree to keep the government on in a caretaker capacity until a new government is formed. Under the constitution, parliamentary consultations are to be held to nominate a new prime minister, who will then be responsible for forming a new cabinet. Protesters have called in the past two weeks for a cabinet of technocrats and are seeking early elections under a new, nonsectarian electoral law that they say should be held within six months. 

Protests and roadblocks in: Beirut (BCD, Ashrafieh,Hamra), Tripoli (Tripoli, Bahsas), Saida (Saida), Zahle (Zahle, Qab Elias, Jdita, Saadnayel), Jbeil (Jbeil), Keserwan (Ghazir, Bouar, Aaqaybe Keserwan, Safra, Zouk Mkayel), Sour (Sour), Aley (Sofar, Aley, Khalde, Mansourieh), Shouf (Barja, Sirjbal, Naame), Batroun (Batroun), Baabda (Tahwita, Aabadiyeh, Chouit, Cite Sportive), Koura (Kfar Hazir), Minieh-Dinieh (Minieh, Beddawi)

*Protests and roadblocks list is structured by caza, and the locations in caza are shown in brackets. Locations in bold indicate first protest in a city from day two. Source of data: Lebanon Support.

The post The first 13 days appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/lebanon-uprising/timeline/the-first-13-days/feed 0
The lasting change from Lebanon’s mass protests https://www.executive-magazine.com/lebanon-uprising/the-lasting-change-from-lebanons-mass-protests https://www.executive-magazine.com/lebanon-uprising/the-lasting-change-from-lebanons-mass-protests#respond Thu, 07 Nov 2019 09:53:47 +0000 http://www.executive-magazine.com/?p=24548 Reading Time: 10 minutes A proposed levy on WhatsApp might have been the trigger for the October protests, but its backdrop was years of mismanagement and corruption that have brought the Lebanese economy to the brink. The outburst of popular protests occurred throughout the country, unifying Lebanese from across socioeconomic divides. Unseen in previous protests was the breakdown of...

The post The lasting change from Lebanon’s mass protests appeared first on Executive Magazine.

]]>
Reading Time: 10 minutes

  • A proposed levy on WhatsApp might have been the trigger for the October protests, but its backdrop was years of mismanagement and corruption that have brought the Lebanese economy to the brink.
  • The outburst of popular protests occurred throughout the country, unifying Lebanese from across socioeconomic divides. Unseen in previous protests was the breakdown of the barrier of fear, from Tripoli to Sour, protesters chanted out against their own political leaders with kullon ya’ni kullon (all of them means all of them) the rallying cry of the protests.
  • The October protests saw the wide participation and leadership of women and youth.
  • No matter the economic or political outcomes of the protests, a cultural and social shift has been unleashed within Lebanon.

Nour Square in Tripoli overflowing with protesters chanting in unison for the fall of the system and dancing to music spun by a live DJ. Men and women across the country have broken free of sectarian shackles, calling out the political class en masse. Street vendors selling kaak and corn on the cob in the streets of Downtown Beirut previously inaccessible to them in favor of high-end cafes and shops. Crowds of people dancing, chanting “hela hela,” “kullon yani kullon,” and the famous Arab Spring slogan of “ash-sha’ab yurid iskat an-nizam,” among others, or participating in public debates in “the Egg” and other reclaimed public spaces in Downtown Beirut. Countless Lebanese of all ages and backgrounds, and in regions all across the country fill up city squares and go on live television to voice their frustration and anger with an economic reality that was brought about by deep-rooted corruption and the entrenchment of the sectarian political order. Protesters across the country began setting up roadblocks that were at times removed by the authorities only to be reformed, sometimes multiple times per day. The most striking example of which was the roadblock on the Fouad Chehab bridge, known as the ring, which connects east and west Beirut, where protesters got creative, bringing sofas and fridges to block off the highway and on the 11th day of the protests posting the area on AirBnB as “Beit el-sha’ab,” which translates to “the people’s home.”

Those participating in mass protests have been united in their calls for a technocratic government and new elections under a new law.

These are just some moments of the October uprising in Lebanon, at the time of writing in its 13th day, which is being described as the tipping point and a game changer for the country. Those protesting—at one point media estimates put numbers at a quarter of the Lebanese population—succeeded in shutting down the country through blocking roads and organizing a general strike. Banks and schools have remained closed since the second day of the protests, despite some attempts to open the latter. A leaderless movement—an initial strength but as time goes on increasingly perceived as a weakness—those participating in mass protests have been united in their calls for the resignation of the government, a technocratic government put in its place to address immediate economic concerns, the calling of new elections, a more proportional electoral law, and the overthrowing of the post-war sectarian system. Their first victory came just three days into the protests, with the resignation of the four Lebanese Forces ministers from the government. Ten days later, on the 13th day of protests, one marred by violence against protesters from Amal and Hezbollah supporters, Prime Minister Saad Hariri announced his resignation, and by extension, the resignation of his unity government. In the streets, the crowds chased away by the earlier violence returned and celebrated their victory, however, to these protesters the prime minister’s resignation was just one important step on a long path toward much needed reforms and fundamental change in Lebanon.

When enough became enough

Initial protests were sparked by local media reports on a series of proposed taxes that cabinet discussed in line with the 2020 budget. When it emerged that cabinet had agreed to impose a tax on Voice over Internet Protocol services, which would have resulted in a charge on the use of WhatsApp calls up to $6 per month on top of by regional standards high phone bills (two to three times those of regional peers), this was seen as the straw that broke the camel’s back. It was not, however, the underlying cause of this October uprising, as was initially naively reported in both local and international media.   

Photo by Greg Demarque | Executive

Our own coverage of the Lebanon economy over the past 20 years has shown time and again what needed to be addressed to prevent a looming economic crisis (see Executive’s 2019 Economic Roadmap). As we entered into this October, Lebanese had faced multiple gas station strikes and strikes from bakeries over difficulties that gas distributors and wheat importers had in securing dollars at the official rate to pay for imports. Fear over the potential dollar shortage was stoked by residents facing issues withdrawing dollars from ATMs and banks, trouble depositing Lebanese lira in dollar accounts, and increasingly higher unofficial exchange rates.

In the days leading up to the protest, Lebanese literally watched in horror as some of the worst wildfires in over a decade spread across the country aided by a heatwave and high winds, with the Chouf and Metn areas particularly hard hit. Over two days, Lebanon lost at least 1,200 hectares of forest according to George Mitri, director of the land and natural resources program at the University of Balamand, who was cited in several media reports. Added to the 1,300 hectares already lost this year, the annual average due to wildfires, Lebanon doubled its annual losses in the span of 48 hours. And while the Lebanese banded together to provide aid to those displaced, and food and water for the unpaid civil defense teams who fought the fires, it emerged that the country was in possession of three firefighting helicopters—donated by citizens who had raised millions of dollars for their purchase back in 2009—that the government had failed to maintain. To add insult to injury, Free Patriotic Movement MP Mario Aoun came on a local TV station to question why these fires were targeting Christian areas—a statement as categorically untrue as it was moronic. It is against this backdrop that when it was announced that the cabinet had decided on regressive tax measures, including the tax on WhatsApp, hundreds of people took to the streets. Across the country, the common call was for the downfall of the corrupt and inept regime. The Lebanese revolt had begun.

The times they are a changin’

The first line in the Tunisian poet Abu al-Qasm al-Shabbi’s “The Will of Life” translates into, “If one day a people desires to live, then fate will answer their call.” With the October uprising, it seems that the Lebanese people have loudly and clearly chosen life. Regardless of whether fate will answer their call or not, their desire to live has manifested itself in ways that cannot be taken away from them.  

The most powerful outcome of the October protests is the breakdown of the barrier of fear across Lebanon that had prevented the people of Lebanon’s various sects from openly questioning leaders. For the first time in recent memory, Lebanese from Tripoli to Sour—through Nabatieh, Saida, Batroun, Beirut, and others—were publicly criticizing and cursing those in the government from Foreign Minister Gebran Bassil to Speaker Nabih Berri to Prime Minister Saad Hariri, and, following his first speech on the third day of protests where he backed the current government, even Hezbollah Secretary General Hassan Nasrallah.

Across the country, the common call was for the downfall of the corrupt and inept regime. The Lebanese revolt had begun. 

While protesters in Nabatieh and Sour were met with aggression by supporters of Amal and Hezbollah, the majority still persisted in their critiques and demands that the government resign. The economic reality of the majority of Lebanese—the bottom 50 percent receive just 10 percent of the national income—has led to an unprecedented breakdown in the current sectarian order. Across the country, and particularly outside the capital, Lebanese citizens decided that is was no longer acceptable for them to struggle to find work to support themselves and their families, while the politician they had blindly supported grew richer at their expense. Lebanese realized their roles in keeping these politicians in their chairs and entrusting them with the job of securing their basic rights as citizens. If the government does not deliver, then they, the people, have the power to hold them accountable—and so they did. 

Photo by Greg Demarque | Executive

The resignation of Hariri’s government affirmed Lebanese people’s new-found faith in their power to effect change in their country, and there is no turning back now. Even if the protesters do end up leaving the streets and opening roads, they now know they can go back down again and demand change when needed. The anger and the power that has been released cannot be easily bottled up again.   

Another rarely seen before outcome of the protests is the spontaneous unity among Lebanese across sects and social classes. The fact that an estimated 1 million people gathered across Lebanon on October 20, without any call from a political party or sect leader to do so, is truly heartwarming. Reciting both the Fatihah and the Rosary in Jal el-Dib is unprecedented. Public space has been reclaimed as a long soulless Downtown Beirut becomes the balad again, alive with street vendors, town hall-style debates—a place for all people to gather. In Martyr’s Square and Riad el-Solh, university students and intellectuals can be found alongside moped riders, coordinating on roadblocks.

The resignation of Hariri’s government affirmed Lebanese people’s new-found faith in their power to effect change.

And while accusations that the protests have, over time, become more middle class are valid, there have still been important steps toward breaking down class barriers and shifting to more horizontal alliances. That sense of caution and fear that many Lebanese have of “the other”—whether that other is from a different sect or a different social background—has also been broken as the realization that we are all suffering from the same economic strains under the corrupt system becomes clearer. In Tripoli, long seen as a bastion of Sunni extremism, they chanted in solidarity with the protesters of Sour. 

Breakdown of a protest

While Lebanese of all ages are participating in the protests, they are largely sustained by the youth who did not live through the civil war and are thus less cautious and more optimistic than their parents’ generation that change can be achieved without a descent into violence.  

The role of women in October’s uprising also needs to be highlighted. One of the most iconic images, taken on the first day of the protests, was of protester Malak Alaywe kicking one of Education Minister Akram Chehayeb’s armed bodyguards in the groin. After the first two days, when protesters were met with tear gas and rubber bullets by the riot police in response to mild provocations from the crowd, day three saw women standing on the frontlines, creating a barrier between security forces and the male protesters to prevent the escalation of violence. Tripoli’s Jana Jammal became another icon of the revolution when she spoke about being a university graduate unable to find a job without wasta and about her mother’s healthcare issues. Across social media, other examples emerged. In Riad el-Solh and the public gardens in its vicinity, women are leading debates on public spaces, anti-sectarianism, and the way forward after the
protests.

The protests have affirmed that women and youth, both of whom are traditionally marginalized in Lebanon’s patriarchal political system, are capable leaders.

When they try to fight back

Mahatma Gandhi said, “First they ignore you, then they laugh at you, then they fight you, then you win.” Lebanon’s revolt has passed through these three stages and has secured its first major victory with the resignation of Hariri. What was striking throughout the past 13 days was the protesters’ persistence and their insistence to persevere with their peaceful approach despite security forces forcing open roads and counter-revolutionary forces attacking them.

The political elite’s response to these protests—until Hariri’s resignation—was lacking. Hariri addressed the protesters on the second day, announcing a 72-hour deadline for the cabinet to agree on reforms. When these reforms were announced, they were met with general distrust from protesters. It took over a week for the president of the republic to address the crisis, doing so in a prerecorded and short statement that also failed to address demands. After an initial speech on day two, backing the government, Bassil—the subject of a lot of the protesters’ ire—had stayed silent until after the 13 days. Most notably, after this first speech failed to have any impact on the streets, Nasrallah spoke again on the ninth day of the protests, alleging that what began as a spontaneous revolt was now being influenced by foreign embassies and local political parties, calling on the protesters to disclose their funders and for his own supporters to leave the streets. Social media posts declaring themselves the funders of the protests began to appear, along with jokes of sandwiches supplied by different embassies.

Photo by Greg Demarque | Executive

In Sour and Nabatieh, protesters have been facing violence from the second day of the uprising. The protesters in Beirut were met with violence three times—the most recent of which was at the ring when thugs attacked protesters and journalists while chanting pro-Hezbollah and pro-Amal chants before the army was deployed to separate them. The same group headed to Downtown Beirut where in a matter of minutes they tore down the tents and infrastructure the protesters had built over days. Protesters did not take the bait. They persisted with their peaceful protesting, and once the security services had cleared the thugs out of Downtown began to rebuild their tents. 

On roadblocks, protesters proved persistent and determined. When security forces would open one road, protesters would simply close it again. When rumors spread that security forces would reopen the streets at dawn, protesters slept on the streets to prevent that from happening, or abandoned their cars to block off highways. Road closures became a power struggle between the government and the people, one that the people seemed determined to win.

Corruption is so deeply entrenched in Lebanon that it is difficult to erode.

Corruption is so deeply entrenched in Lebanon—starting from the public sector employee who asks for a bribe to complete a simple procedure to elected MPs stealing the people’s money—that it is difficult to erode in a few months or even years. So while there may be short-term political gains from these protests, manifested in the formation of a technocrat government and early parliamentary elections, a complete system overhaul is required—and when or whether that happens is uncertain.

Some economic changes may be immediately apparent following the protests, but real economic reform will take years. What can be said with certainty is that October’s uprising has irreversibly changed Lebanese people’s relation to themselves. It has led them to fall in love with their country again, and to know that they have the power to fight for it. This has regional implications that could be the start of a real spring. And that is something beautiful.   

The post The lasting change from Lebanon’s mass protests appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/lebanon-uprising/the-lasting-change-from-lebanons-mass-protests/feed 0
Lebanon’s uprising has potential ripple-on effects https://www.executive-magazine.com/opinion/lebanons-uprising-has-potential-ripple-on-effects https://www.executive-magazine.com/opinion/lebanons-uprising-has-potential-ripple-on-effects#respond Thu, 07 Nov 2019 09:30:35 +0000 http://www.executive-magazine.com/?p=24533 Reading Time: 8 minutes As the aftermath of the Arab Spring saw the Levant descend into another iteration of political posturing and advantage seeking of what in earlier times was often derogatorily called Levantine behavior, Iraqi-Lebanese journalist Husain Abdul-Husain shared his dismay. In a story published five years ago, he drew as his conclusion from a decade of Iraqi,...

The post Lebanon’s uprising has potential ripple-on effects appeared first on Executive Magazine.

]]>
Reading Time: 8 minutes

As the aftermath of the Arab Spring saw the Levant descend into another iteration of political posturing and advantage seeking of what in earlier times was often derogatorily called Levantine behavior, Iraqi-Lebanese journalist Husain Abdul-Husain shared his dismay. In a story published five years ago, he drew as his conclusion from a decade of Iraqi, Lebanese, and Syrian experiences of seeking change from popular roots that “non-sectarian, liberal citizens are few, helpless and irrelevant.”

One of the experiences he explained as underlying his judgment was the juxtaposition of the March 14 and March 8 protests and subsequent political movements in Lebanon. Expressions of two sharply separate (but each partisan and partially goaded) popular wills, these mass demonstrations on Martyr’s Square and Riad el-Solh Square in response to the assassination of former Prime Minister Rafik Hariri deteriorated all too soon into the wrangling for political power and positions by and within their eponymous movements.

Unprecedented unity

On March 8, 2005, hundreds of thousands had followed calls of their leaders for a pro-Syrian demonstration. The March 14 anti-Syrian demonstration saw Martyr’s Square packed again with hundreds of thousands—crowd size estimates were unreliable for both demonstrations. Regardless, the crowd on the latter day was so dense that one of Executive’s editors was unable to walk a straight line from one end of the square to the other. It was the largest demonstration in Lebanon’s history.

Last month, Martyr’s Square was, by comparison, loosely packed—noting, however, that protests were nationwide. The difference between the calls for freedom, sovereignty, and independence on March 14 and the thawra (revolution) shouts of October 2019 could not have been larger. Contrary to what felt at least partly orchestrated and what was even affixed with some sort of marketing label by revolution-happy American diplomats as the Cedar Revolution, the Lebanese citizen’s protests in 2019 (and, according to reports, the protests in Iraq) delivered overwhelming evidence that the liberal, non-sectarian citizens in the Mashreq countries are no longer few, helpless, and irrelevant. Not anymore.

Far from making a defeatist impression, the young and older protesters of 2019 were uniting beyond political affiliations and bursting old mental shackles. Not just in the heart of Beirut—all over Lebanon. They were powerful, they were many, they were completely determined and defiant of intimidations and assaults. In Martyr’s Square, the ragtag assemblage of protests and revelry in late October radiated with an intensity that can only be described as revolutionary ecstasy—a web of powerful emotions, and an atmosphere supercharged with lifetimes of frustration and fear, of suppressed desires, and of dreams and hopes.

Even outside of the frenzy on Martyr’s Square, you could see it in the eyes of people who were walking back home from the protests—and even those attending a sober editorial meeting at our magazine—that these days of October 2019 were qualitatively and—in their nationwide dimensions—quantitatively incomparable to any Lebanese moment and national experience in the past 100 years.

The October protests had no primary leaders but rather relatively utopian demands for a fair society.

The narrative of this emanation of popular sentiment and will began to be formulated within the first three days of protests and will certainly evolve. As a continual wave of events without precedent in this country, however, the developments pose a tremendous challenge as to pinpointing their exact political, social, and economic drivers and demands, and, most difficult of all, their outcomes over time.

The difficulty and simultaneous need to talk about possible impacts of this new revolution is put into perspective when one thinks of the aspirations, expectations, and actual results of the Arab Spring in Tunisia, Egypt, and Libya at the beginning of this decade. Not only did the Arab Spring uprisings devour some of their children in the often-seen pattern by which rebel leaders turn into the next iteration or mirror image of the leaders they rebelled against, but the entire movement came to be lamented by many Arab scholars as an Arab Winter just a few years after the initial euphoria of 2011 and 2012.

It has to be mentioned here that the Lebanese October protests had no primary leaders but rather relatively utopian demands for a fair society and political system, a better economy, and an end to corruption.

Prospects for Lebanon

It, furthermore, should be self-explanatory, but still needs to be emphasized, that the Lebanese national case of a multi-fragmented, consociational country is beyond comparison. No other country would be similar in having a confessional political system that persists in contradiction to its constitution and that exists under economic conditions that defy all conventional understanding.

The list of the peculiarities of this economy only begins with a dollar-peg that has lasted for more than two decades, and a balance of trade that has been not just consistently negative, but immensely so. It stretches to a public debt that has not been lower than 120 percent of official GDP for longer than half of the population has been alive. Inversely, the list also includes achievements of Lebanon never having defaulted on its obligations despite a succession of economic, political, and security shocks (that extended to assassinations of several key personalities) and of monetary inflows that brought banking deposits to a multiple of GDP.

Its curious constellation of economics and politics in locale that qualifies as one of the top global crisis hotspots for the past 70 years means that it is only possible in a most general sense to think of Lebanon as a country that is stepping in the footprints of other countries and populaces that have gone through revolutions. It is certainly not like Egypt, Tunisia, Libya, or any other MENA country. But when thinking about Lebanon’s prospects after October 2019, perhaps some general allusions to the uprisings of the 20th century can give some pointers, namely to the Prague Spring and the May 1968 cultural revolution in Western Europe with its Parisian center.

These two revolutionary chains unfolded and ended very differently from each other in the short term—the Prague Spring was quenched by Warsaw Pact troops and Soviet tanks with blunt force, May ‘68 produced new elections, but not system change, in Paris. Despite its socialist dreams and slogans calling for an overthrow of the capitalist order, there was no change in the political systems in Western Europe and very limited impact on institutions beyond those in tertiary education, nor did ‘68 put the economies of their source countries on new tracks.

Notably on the economic development side, the much bigger shock for economies in Western Europe occurred in the oil crisis and resource shocks of the 1970s—but Western capitalism only reemerged with greater vigor afterward. In Eastern Europe, societies continued to limp behind the West as they followed central planning paradigms of self-declared scientific socialism that was presented by its proponents as a form of technocracy.

Photo by Greg Demarque | Executive

The political and economic aspirations of many in the post-war student generation proved to be impossible to achieve. But ’68 had profound cultural and social impacts which, in the reflection of European historian Ian Kershaw, indelibly impacted the minds and perspectives of those who participated. “The anti-authoritarian, egalitarian and libertarian attitudes of the ‘68ers had a lasting impact,” Kershaw affirmed 50 years later.

Also, the seeds of popular will sown in the Prague Spring, growing painfully over time in dissident movements such as Charta 77, contributed at long last in the post-1989 revolutions to the delayed outcomes of liberty for the peoples that had been living behind the Iron Curtain since the end of World War II.

In this sense, the long-term social and cultural impacts of Lebanon 2019 might materialize in advancing and making more resilient the spirit, responsibilities, and freedoms of self-determination that the region excitedly—and in hindsight prematurely—sensed as rising in the Arab Spring, only to see it submerged again in the swirls of regional and geopolitical realities. This is to say that cultural departures from the narrow systems of the patriarchal past might ultimately find their verification and results in the ultra-long term, through changes in the Arab world that are beyond imagination and which could include both political and economic blooming.

The economic bloom could be enormous, considering the long past of unrealized potentials for such increases under existing systems with heavy ceilings of backward business organization, severe political and economic under-participation of women, and social tutelage of vast population groups. This awakening of Arab economies could, at least by today’s standards of capitalist growth, be realized to the tune of significant productivity increases and double-digit growth spurts in utilization of human capital, financial inclusion, economic outputs and—with improved diversity and complexity of Arab economies—mutually beneficial regional trade interactions and integration of Arab countries.

Such long- and ultra-long-term developments would be a boon to Lebanon as an economy with a bridge function and historic networks, not to mention its immensely charged-up young human capital. Yet, it cannot be denied for a second that such propositions of economic and political freedom and prosperity are dreams and hopes with a large dose of pro-Lebanese bias and are—by nature of all economic expectations, hopes, projections, and predictions—speculative with an exponentially increasing degree for uncertainty for each futuristic conjecture. In the long term, it certainly is also a conjecture and one that attempts to deliberately counter both existing international stereotypes and the last five to seven centuries of Arab peoples’ history, to believe that this October uprising could shine 50 years from now as a central ignition point of new cultural and social intercontinentally effective lead roles of enlightened Arab women and men in a less insane global society.     

In the immediate outlook for Lebanon there is, of course, more economic uncertainty than one could wish for. The rise of social discrepancies and economic pains for households, the damaging but necessary potentials of controls in the financial sector, the price and inflation spirals to the detriment of consumers and producers, the likely hardships and business risks for importers, the failure prospects of enterprises of all corporate ages, the acceleration of unmitigated public sector problems, and the macro uncertainties can hardly be over-projected. 

It is time to fight constructively on all economic fronts. 

It, moreover, has to be acknowledged that the local stakeholders in the economy might have little or very little that they realistically can do in the immediate term to steer enterprises away from the cliffs and sandbanks of shallow credit and perilous monetary waters. And as far as betting on grand economic plans by expensive consultants, infrastructure visions that depend on international financial inflows, initiatives with weak institutional and incomplete legislative foundations (e.g. public-private partnerships), and mega-projects (other than, hopefully, the power generation and distribution plan), it appears advisable to take a deep breath and preserve one’s mental energy for just a bit.

Still, it will not be good to abandon all thoughts or send all passions into flight mode. It is time to fight constructively on all economic fronts. In this very important context of economic reforms and ideas for strategizing and talking development, what makes sense from the perspective of Executive is to think, debate, plan, and act in the same way that the October events found their success: inclusively and from the bottom up. We are not relenting to emphasize that the economy, while notoriously non-compliant with expert prescriptions or technocratic central planning, and while often behaving (like the humans that make it) in the most surprising ways, is the people’s action game and arena.

Executive, as another fight that we will not give up on, had one year ago launched a project for an economic roadmap that was distinguished by design: It sought out the inputs of civil society and local stakeholders in wider and more democratic participation than any other view on our future that, in Executive’s humble opinion, is full of our social needs and economic potentials. We call on you, our faithful readers, and on all who invested their heartfelt passions into determining a new future for Lebanon in October 2019, to contribute to the next round of developing a better economic and social future and together build, strategize, combat, and develop new pathways. Take our roadmap forward, improve it. We are ready to do it with you.        

The post Lebanon’s uprising has potential ripple-on effects appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/opinion/lebanons-uprising-has-potential-ripple-on-effects/feed 0
Time to rise above https://www.executive-magazine.com/opinion/time-to-rise-above https://www.executive-magazine.com/opinion/time-to-rise-above#respond Wed, 06 Nov 2019 11:18:56 +0000 http://www.executive-magazine.com/?p=24529 Reading Time: 2 minutes Executive has been shouting over and over again for change in this country, calling the bluffs of successive governments in our more than 20 years of coverage. At times, it seemed as though we were screaming into the void. Ignored by the policy-makers, targeted by threats and lawsuits, and resigned to the lack of reaction...

The post Time to rise above appeared first on Executive Magazine.

]]>
Reading Time: 2 minutes

Executive has been shouting over and over again for change in this country, calling the bluffs of successive governments in our more than 20 years of coverage. At times, it seemed as though we were screaming into the void. Ignored by the policy-makers, targeted by threats and lawsuits, and resigned to the lack of reaction from the public at large. And then suddenly Lebanon erupted, the people took to the streets in one voice—and we could not be happier.

Now we look back at our analysis and economic roadmaps over the past two decades as our contribution to every man and woman on the streets during this October uprising. The streets have revolted. No longer in self-denial, the people have banded together against the mismanagement of this country that has affected the livelihoods of the Lebanese people for too long.

The people have decided to risk the little they have left for a better tomorrow. As much as this popular revolt was long overdue and brings welcome challenges to the incompetent elites, a revolution in Lebanon is a whole other ballgame. Already, we have seen in the speeches of Hezbollah leadership and the presidential palace the stark difference between their concerns and the concerns of the people.

While the protesters out in force across the country can no longer bear the vulgar mismanagement of the political class and their abject failure to provide Lebanese citizens with even the most basic of services, those same politicians are worried about shifting the status quo that serves their geopolitical alignments. And that is where the danger lies, in the lines that have been drawn.

Meanwhile, attempts to attack Lebanon’s central bank are no more than a smokescreen to shift blame away from politicians whose mismanagement of the economy will always manifest itself in monetary repercussions—we are not taking the bait.

The reality is that Lebanon is part of the region’s northern front that spreads from Iran to the Mediterranean with Lebanon at its western end. We are in the heart of the storm, torn once again between east and west. As we go to print, we walk blindfolded on a tightrope demanding to live in dignity in our Lebanon. The cold reality is that in the geopolitical sphere, spilling our blood is cheap.

We should not give up the fight. Lebanon has a unique chance to fight for its own future and decide its own fate. What we have witnessed across this country since the uprising began in mid-October is nothing short of miraculous. Together as one we stand united—against sectarianism, against corruption, and against the economic realities imposed from the top down.

This is a once in a generation chance. Grab it fast before it is stolen away.

The post Time to rise above appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/opinion/time-to-rise-above/feed 0
Le monde du plus fort ou du plus fou https://www.executive-magazine.com/opinion/le-monde-du-plus-fort-ou-du-plus-fou https://www.executive-magazine.com/opinion/le-monde-du-plus-fort-ou-du-plus-fou#respond Mon, 21 Oct 2019 12:40:42 +0000 http://www.executive-magazine.com/?p=24520 Reading Time: 2 minutes French anthropologist Marc Augé coined the phrase “non-lieu” (non-place) in the mid-1990s to describe places where considerations of history and identity were erased—think shopping malls or airports. Listening to him speak in Lebanon earlier in September got me thinking, Lebanon is the antithesis of a non-lieu. Every space in Lebanon is linked to our history...

The post Le monde du plus fort ou du plus fou appeared first on Executive Magazine.

]]>
Reading Time: 2 minutes

French anthropologist Marc Augé coined the phrase “non-lieu” (non-place) in the mid-1990s to describe places where considerations of history and identity were erased—think shopping malls or airports. Listening to him speak in Lebanon earlier in September got me thinking, Lebanon is the antithesis of a non-lieu. Every space in Lebanon is linked to our history and our identity—even the naming of our highways and airports evoke politics of our past.

In some ways that means we can never escape the economic and political realities of this country. Never free ourselves of our past to allow independent and forward thinking. Yet, many Lebanese—at least when times are good—seem content to stay in their heads, behind their screens, immersed in social media and technology. Those who stay in the lieu of it all are those with a bigger stake in protecting their share, but also those who have in the past been easily manipulated.

If we want to see change, real change, in Lebanon, then all of us have to get back into the lieu. We need the middle classes to be more aware of the realities around them in both good times and bad. Our political class has been taking advantage of the absence of oversight in this country, indulging in what is not theirs to take. But change is coming. It is no longer possible to detach ourselves from reality. The one space where we could express ourselves freely, the non-lieu of social media, is becoming a place of oppression. Our online thoughts and tweets subject to state scrutiny. But this overreach has a side benefit: More are beginning to take notice and understand the diversionary tactics employed by our politicians. And they will hold this political class accountable for every violation they have perpetrated against the people.

The end of September brought with it a whirlwind of rumors and fears over dollar liquidity in Lebanon. People rushed to withdraw their money from the banks. Panic ensued, while our delusional and dishonest politicians continued to squabble over the little that was left for them to steal. We have been here before. Many middle class Lebanese in the mid-80s, my family included, found themselves impoverished when the lira devalued. But chaos always has its victors; the few profited, while ordinary families struggled to get by. We were kept in the dark then, as we are now. But the cracks are beginning to show.

It has been 18 months since the international community pledged $11 billion on the condition of serious fiscal reform. In the time since, there has been a lot of talk, but little action. Duquesne and others no longer hide their impatience with the unruly rabble that we have in place of statesmen. Our politicians behave like kindergarteners, bickering among themselves, while the international community looks on with disdain. Warning after warning goes unheeded, and Lebanon teeters on the brink of crisis.

To our politicians, I say this: It is your choice. Be strong or be fools.

The post Le monde du plus fort ou du plus fou appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/opinion/le-monde-du-plus-fort-ou-du-plus-fou/feed 0
Oil and gas will not save Lebanon https://www.executive-magazine.com/opinion/oil-and-gas-will-not-save-lebanon https://www.executive-magazine.com/opinion/oil-and-gas-will-not-save-lebanon#comments Fri, 11 Oct 2019 08:12:20 +0000 http://www.executive-magazine.com/?p=24483 Reading Time: 3 minutes As Lebanon races to enter the new oil producers club, decision-makers display a dangerous tendency to put all hopes on this uncertain sector and label it as the economic savior. This goes against the advice of Lebanese experts who have been warning against a “presource” curse  (the underperformance of economic growth after a commercial discovery,...

The post Oil and gas will not save Lebanon appeared first on Executive Magazine.

]]>
Reading Time: 3 minutes

As Lebanon races to enter the new oil producers club, decision-makers display a dangerous tendency to put all hopes on this uncertain sector and label it as the economic savior. This goes against the advice of Lebanese experts who have been warning against a “presource” curse  (the underperformance of economic growth after a commercial discovery, but long before production—a result of skyrocketing expectations and a correlated increase in public spending and/or borrowing) and calling for structural remedies to the economic crisis. Early last month, Pierre Duquesne, the French envoy in charge of the CEDRE dossier, warned against the “false hope” that oil and gas extraction was a “magic remedy.”

The Lebanese economy is facing great challenges. Indicators show signs of a prolonged contraction. The financial model long used to maintain the Lebanese standards of living—despite unsustainable levels of public debt, budget deficit, and current account deficit—is now on the verge of breaking. The deficit in the balance of payments accelerated from $0.76 billion in the first seven months of 2018, to $5.32 billion over the same period in 2019. In an attempt to lure back depositors, Banque du Liban (BDL), Lebanon’s central bank, has raised rates on its deposit facility to unprecedented levels.  

Pierre Duquesne warned against the “false hope” that oil and gas extraction was a “magic remedy.”

Despite—or because of—this bleak economic picture, decision-makers (government, heads of political parties, members of Parliament) are putting all bets on the oil and gas sector. 

The 2019 budget openly cites Lebanon’s potential oil and gas wealth as one of the reasons to not worry about the risk of default. The government is thereby implicitly dismissing the costly efforts needed to tackle the crisis, and using anticipated proceeds from oil and gas resources that are yet to be discovered in order to boost confidence.

Last April, the government launched the second licensing round for five new offshore blocks. This came prior to any commercial discovery in wells that will be drilled in the coming three to five years by the Total-Eni-Novatek consortium. Under more relaxed economic circumstances, in order to improve awarding conditions, the government should have waited for the results of the first round of drilling, scheduled for the end of 2019, before launching the second licensing round.

Total is also being pushed by Lebanese authorities to start drilling as soon as possible; a pressure the company says it has accepted. Instead of the usual one to two years to determine the exact location for drilling, Total did so in less than one.

All these signs are a clear indication that while authorities are buying time through unconventional monetary policies to compensate for increasing imbalances (growing debt, fiscal and current deficit), their only hope is to bet on an exogenous “miracle” such as petroleum wealth to save the day. Tapping into uncertain non-renewable assets that belong to future generations to cover for debt accumulation and mismanagement of current resources is not an option. All efforts should instead concentrate on developing a strategy to get back on a sustainable debt and fiscal path.

Tapping into uncertain non-renewable assets that belong to future generations to cover for debt accumulation and mismanagement of current resources is not an option.

Countries, such as Ghana and Sierra Leone that have pinned excessive hopes on uncertain future revenues have paid the price in the form of declining economic growth. The government is falling into this presource trap, notably by seeking at a very early stage to establish a Sovereign Wealth Fund outside the framework of a broader macroeconomic vision. We believe that prior to creating an oil fund, the government ought to reduce public debt to sustainable levels, and enact and enforce fiscal rules to credibly commit to fiscal sustainability in the future. 

The real challenge that lies ahead for Lebanon is to agree on a new economic and social contract that promotes a competitive and fair economy, instead of capturing state resources to fuel a corrupt political system. The only way forward today is to tackle head-on the task of sharing the burden of losses accumulated by this failed economic model. Hoping that oil and gas proceeds will cover up for these losses is at best an illusion, and at worst a crime. Lebanon needs to make sure that future proceeds are not allocated through the same economic model and find channels that can transform them into investment capital within a new economic and social strategy. The only guarantee that this sector will not be used to fuel further corruption is sound governance practices that ensure an inclusive, transparent, accountable, and participatory management of this potentially lucrative sector. As a start, transparency measures, such as beneficial ownership disclosure as mandated in article 10.7 of Law 84 (2018) on enhancing transparency in the petroleum sector, need to be applied to all contracted and subcontracted companies working in the oil and gas sector in Lebanon.

The post Oil and gas will not save Lebanon appeared first on Executive Magazine.

]]>
https://www.executive-magazine.com/opinion/oil-and-gas-will-not-save-lebanon/feed 1