Leaders

Flip the switch

by Executive Editors
written by Executive Editors

In fact, it could be a lot faster immediately, at very little effort or cost. A new state of the art network of fiber optic cables has been installed connecting some 350 central offices around the country (where international capacity is delivered before it reaches the end users), to many heavy users — such as hospitals, universities and businesses. This network is actually designed to serve all of the country, down to the last hovel.

This fiber optic backbone, however, is turned off. That means the fiber is in the ground, connected to the various modems, routers and switches, and ready to go. But there is currently no data traversing it. The “switch” — or more accurately series of devices in the central offices — has not been turned on. This comes in spite of internet speeds being increasingly cited as a factor of economic growth. In low and middle income countries, a 10 percent increase in broadband penetration has correlated to an additional 1.38 percent in GDP growth, according to the International Telecommunications Union’s research presented in its Impact of Broadband on the Economy 2012 report.

Turning on the switch would have a significant impact on Lebanon’s internet speeds. While the fiber optic cable does not yet connect residences, it would from day one benefit the operations of many places such as businesses and academic institutions — where much of the country’s productive work is done. Faster internet would also make the country more competitive, and would draw in badly needed investments, particularly in the ICT field.

From all the evidence that we have, we get the impression that the fiber could go on within weeks. We have not been presented with any remotely logical excuse explaining why this is not the case. The switch needs to either be turned on, or those responsible for overseeing Lebanon’s fiber optic infrastructure need to step forward and give us a proper reason why it’s off.

While Executive is still waiting on several interviews requests with people from the Ministry of Telecommunications and Ogero, the consultants to the Minister of Telecommunications who spoke to us claimed that the fiber is off because of certain technical mistakes from the company that was contracted to do the work. The affected infrastructure segments are in the process of being redone, the consultants said. Though they could not specify exactly how much of the infrastructure actually needed reworking, they did acknowledge that it was only a small part.

This explanation is not exactly satisfying to explain why an entire fiber optic backbone is sitting idle, and why we haven’t already put some of it to use. We’re still entirely relying on what is an old and outdated infrastructure, mostly made of copper save for a small fiber optic loop which was originally meant to serve as a local network for Ogero’s internal operations. The fact that we have newer infrastructure across the country and are still making do with the old is absurd.

Currently, both the Ministry of Telecommunications and Ogero have oversight over the telecom infrastructure. These entities need to be accountable to the people for the assets they are managing. The fiber optic cable was paid for by government money, and any investment made by the government has to benefit the people. The Ministry of Telecommunications and Ogero need to either flip the switch or present a proper explanation to the Lebanese people as to why our fiber infrastructure is not in use, and when it will be readily in use.

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Economics & Policy

Cleaning up

by Matt Nash
written by Matt Nash

If all goes as planned, 2015 will be a big year for new contracts in the waste management sector, which has been dominated by the Averda companies Sukleen and Sukomi since the 1990s. The government is pushing ahead with a national municipal solid waste (MSW) plan that will see the country divided into six service regions while grant money from the European Union will also fund the construction of new sanitary landfills and waste treatment facilities. Combined, there are 21 MSW projects in the pipeline, five of which are currently being tendered, according to officials responsible for implementing them. While these new projects mean business opportunities for both local and international companies, they could also mean the end of uncontrolled dumps, the dangerous “final” resting place of nearly 30 percent of Lebanon’s garbage.

Talking trash

In 2014, Lebanon disposed of an estimated 6,549 tons of MSW, according to an environmental assessment of the Syrian conflict on the country, commissioned by the Ministry of Environment and published in September. While the report noted that 99 percent of the waste is collected, it did not give a complete breakdown of where the waste went. In 2013, statistics compiled by Sweep-Net — an organization focused on waste management in MENA — showed that 8 percent of Lebanon’s MSW was recycled; 15 percent composted; 29 percent thrown into uncontrolled dumps; and 48 percent put into sanitary landfills — which are designed to keep rotting garbage from polluting the soil and groundwater beneath them. The Sweep-Net figures exclude additional MSW resulting from the influx of Syrian refugees, and the accompanying report notes that the recycling figure may be higher because of informal collection of valuable recyclables, which the organization admits cannot be quantified. 

[pullquote]Managing all of this garbage has long been a challenge for the state[/pullquote]

Managing all of this garbage has long been a challenge for the state. According to its website, the engineering consultancy LibanConsult AGM won a contract to help the government plan a national strategy back in 1971. To date, the closest thing to a master plan for MSW that Lebanon has is the 1997 Emergency Plan for the Greater Beirut Area. As its name implies, it was not meant to last forever. Since then, various efforts at creating a national MSW strategy — including an attempt to ratify a unified MSW law — have failed. From a legal perspective, waste collection and disposal are the responsibility of municipalities, although various other legal texts give ministries such as those of the interior, environment and public health a role in MSW management as well (hence the attempt to define responsibilities for waste management in one law). 

The big fish

According to Averda’s website, Sukleen has been sweeping Beirut’s streets and collecting its residents’ trash since 1993. Its sister company, Sukomi, won contracts to treat and landfill that waste in 1998. Treatment consists of composting organic material as well as sorting and reselling recyclable materials. Today, the two companies are the waste managers for Beirut and five other districts (i.e. the province of Mount Lebanon, excluding the Jbeil district). Sukleen and Sukomi’s service area accounts for around 50 percent of the country’s garbage. Given that parent company Averda is privately held, data on the Sukleen and Sukomi’s profits — particularly their margins in Lebanon — are private. Sweep-Net reported in 2013 that Averda is being paid $130 per ton for waste collection and treatment in Lebanon, without citing a source. The 2012 strategic environmental assessment for Lebanon’s nascent oil and gas sector, however, quoted head of the urban environment service at the Environment Ministry Bassam Sabbagh saying Averda is paid $140 per ton. Neither Sabbagh nor Averda’s chief operating officer for the Levant and Africa were available for an interview. However, an Averda spokesperson sent Executive an infographic on Sukleen and Sukomi’s work that said the companies handle 3,000 tons of waste per day, which would make the contracts worth between $142 million and $153 million annually, depending on which price-per-ton is accurate. 

[pullquote]Various efforts at creating a national MSW strategy … have failed[/pullquote]

Smaller pond

In line with the government’s new solid waste management plan, the Council for Development and Reconstruction (CDR) is currently tendering for three newly created service zones that slice up Averda’s current area of operations, explains Bassam Farhat — who handles waste management at CDR. In past plans, Beirut and Mount Lebanon were always kept together as one service zone. Under the new plan, Beirut and its immediate suburbs are one zone; Jbeil, Keserwan and Metn (minus suburbs tacked onto the Beirut zone) are a second; and Chouf, Aley and Baabda (minus suburbs tacked onto the Beirut zone) are a third. Bid documents from companies interested in these zones are due April 14, he says, noting that one company — or consortium, as joint ventures are allowed to bid — cannot have more than two contracts. Averda was not available to comment. Without giving an exact timeline, Farhat explains that the issuance of tenders for the three remaining service zones — the Bekaa (including Baalbek and Hermel); the North (including Akkar) and the South and Nabatiyeh — will happen in the future. 

Farhat repeats during the interview that the plan was the result of a “political decision.” Asked if that meant it was flawed or ignored advice from agencies like CDR and the Ministry of Environment — which developed past draft strategies — he said the cabinet had all of the relevant information needed to make the best decision but “in the end, it was their decision.”

Rules of the game

To win a contract for one of the new service zones, a local company bidding alone has to have experience in both collection and disposal, Farhat explains, reading from the tender document. If companies form a joint venture, there must be three: one foreign, one local and one either foreign or local. For joint ventures, one of the partners must meet the experience requirements. The tender rules also stipulate that bidders must have a minimum annual turnover, depending on where they are bidding (for Beirut: $80 million; for Metn, Keserwan and Jbeil: $65 million; and for Baabda, Aley and Chouf: $50 million). For joint ventures, he notes, each partner must meet 20 percent of the turnover requirement individually and the consortium must meet the full target. 

When it comes to determining how to treat the waste and where to put it afterward, Farhat says the winners have some latitude. The tender document stipulates that a bidder must choose from a preapproved list of potential sites for sanitary landfills, sorting or composting facilities, or waste incineration or waste-to-energy plants — depending on which mix of management methods the bidder chooses. The sites, Farhat says, are mostly old quarries or open dump sites. He notes that if a winning bidder chooses to build a sanitary landfill, it cannot landfill more than 40 percent of the waste it handles in the first three years and in years four through seven, it can only landfill up to 25 percent of the waste. The contracts have a lifespan of seven years, renewable for another three.

EU money

In 2013 and 2014, the European Commission approved a total of €35 million ($39.8 million) funding in support of MSW management in Lebanon. The money is being channeled through the Office of the Minister of State for Administrative Reform. Mohamad Baraki, who is in charge of the projects, explains that the money will be used to build six sanitary landfills and seven sorting, composting or refuse-derived fuel (or waste-to-energy) facilities. It will also be used to upgrade two existing waste treatment facilities and train municipal staff on operations and maintenance of the yet to be built infrastructure. Baraki says tenders for a sanitary landfill in Joub Jannine and an upgrade to existing facilities in Zahle have been launched while tender documents for sanitary landfills in Baalbek and Srar — in the northernmost district of Akkar — are currently being prepared. Documents from the European Commission’s (EC) website outlining the details of the two grants note the projects are specifically aimed at reducing tensions between Syrian refugees and host communities. They are targeting the areas currently underserved by waste management companies — i.e., everywhere outside of Averda’s service area. While the rest of Lebanon has collection services and — to some extent — sorting and composting facilities, there is by no means nationwide coverage, and Zahle is the only other city with an existing sanitary landfill. The EC documents and Baraki say these projects are meant to fully service areas outside of Averda’s area of operations, which raises the question of why there would then need to be government contracts to build more facilities. Both Baraki and Farhat explain that the government was aware of the EU projects when deciding on a final plan and will take them into account when tendering. Asked if there is a risk of doubling infrastructure, Farhat says, “No, there will not be more [waste management capacity] than needed.”

The 800 pound gorilla

The primary sanitary landfill for Beirut and most of Mount Lebanon is located some 20 kilometers from the capital near the village of Naameh. Farhat explains that it was initially intended to close in 2008. Two three-year extensions later, residents living near it were sick of the smell. When it looked certain the contract would be extended once again in 2014, angry residents stopped Sukomi dump trucks from accessing the landfill. Trash bins, and Beirut’s streets, were soon buried in mountains of garbage. Politicians and locals reached an agreement in 2014 to keep the landfill open for another year while the government promised to find a solution and close it for good in January 2015. That, of course, did not happen exactly as envisioned. Prime Minister Tammam Salam’s government, formed in February 2014, appointed a ministerial committee to develop a new national solid waste strategy, but the cabinet did not approve a plan — detailed above — until three days prior to the now extended January 15 deadline for closing Naameh. The plan, however, only called for extending the landfill’s operation for three months, renewable once. Given that CDR will only receive bids for the service areas currently dumping in Naameh one day prior to the first three month deadline, it is unclear how an alternative will be found by July 15. Asked if the tender documents offer any hints, Farhat says, “This is a decision the government has to make. The government decided to close it. It’s the government’s decision.” 

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Leaders

The blame game

by Executive Editors
written by Executive Editors

[pullquote]The one capital error that we must eradicate above all is to blindly blame one crisis on the other[/pullquote]

Lebanon’s two current crises will not evaporate anytime soon. Our economy is struggling and GDP growth rates are too low for the needs of an emerging country. Our cities and villages are confronted by a refugee crisis of immense proportions. Neither problem will go away if we just close our eyes and both are related in many ways, but the one capital error that we must eradicate above all is to blindly blame one crisis on the other.

As the Syrian conflict enters into its fourth year evidence of human rights violations committed by all conflict parties against civilians continue to mount. The war has displaced more than 10 million Syrians, both inside the country and out, and left vast areas of Syrian territory unsafe for refugees to return. Reluctantly, Lebanon has welcomed 1.16 million Syrians seeking refuge into the country, but the surge in population that the refugees represent has strained relations. 

The Lebanese government has introduced policies aimed at limiting the number of refugees in Lebanon, and political sentiment has placed the brunt of the country’s economic woes at the feet of the refugees. But blaming the refugees for Lebanon’s faltering economy demonstrates a fundamental lack of understanding of this economic crisis and jeopardizes the country’s ability to solicit donors for needed humanitarian development aid.

The vast majority of refugees have no other choice but to stay in Lebanon for the foreseeable future, and attempts to push them out of Lebanese territory through discriminatory practices, such as municipalities imposing curfews for Syrians and the deregistration of refugees, will help address neither Lebanon’s immediate needs for humanitarian aid nor its long term need of revitalizing physical and social infrastructures. Rather than continuing to blame refugees for the country’s economic woes the Lebanese government must remain resilient — its economic success depends on harnessing Lebanon’s spirit and ability of entrepreneurship to identify ways through this crisis. 

[pullquote]Lebanon has missed the huge economic opportunity that attracting Syrian industrialists to the country would have produced[/pullquote]

It is clear already that Lebanon has missed the huge economic opportunity that attracting Syrian industrialists to the country would have produced. Instead, many of Syria’s businesspeople have opted to restart their businesses and factories in the Gulf countries or Egypt. This mirrors Lebanon’s inability to support its own manufacturers where unreliable access to electricity, the high cost of energy, ineffective industrial zones, and transit costs are among the contributing barriers to Lebanese factories’ competitiveness in regional and global markets. But it has also reflected upon the government’s inelasticity to quickly address this economic crisis.

As bad as Lebanon’s economic situation now appears there may still be opportunities to capitalize upon. On our streets one can see plenty of budget-size cars with Syrian license plates, but also enough SUVs and luxury sedans to imply that Lebanon is hosting Syrian population segments that have some level of purchasing power. The hospitality industry has realized that opportunity — often led by Lebanese businesspeople. More than a few restaurateurs have found success in marketing their establishments to the large Syrian population able to afford a meal out.

The state still has chances to make good. At specific levels, the reduction of bureaucratic red tape can coax small gains for Lebanon’s industries. Reducing barriers to imports would help, for example, hospitals reduce the time and cost of acquiring medical equipment not produced in Lebanon. Even as the Lebanese government remains restrained by an imposed political paralysis, there is much more that its ministries can do to facilitate transactions in the country’s economy. Instead of pointing the finger of blame at refugees, Lebanon’s politicians and government leaders should be looking at ways to leverage the crisis.

Rather than abhorring their presence, Lebanon must actively identify the communities and projects that would contribute most to addressing the needs of both refugees and their host communities — an initial step in reassuring donors of Lebanon’s worthiness as a country to invest in. Lebanon’s leaders must also stump for those investments to convince the international community to finance infrastructure products that will immediately alleviate the suffering of refugees, improve provision and quality of infrastructure services for all inhabitants in the short and mid term, and spur economic growth in the long term.

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Comment

How to entice right

by Joe Saddi, George Sarraf & James Thomas
written by Joe Saddi, George Sarraf & James Thomas

One of the greatest challenges facing the Middle East is also one of the most underappreciated: how to attract and retain human capital. This is a real impediment to the strategic plans of some Middle East countries, particularly those in the GCC. They are making the transition away from resource based economies to knowledge based industries, and those industries rely mainly on human capital.

Prominent among those industries are premium professional services firms. These firms, including our own, can make a major contribution in repatriating human capital. Their strong values, global connections and clear opportunities draw highly skilled and well educated emigrants back to the region — often to stay.

We do not underestimate the factors that make it challenging to repatriate the region’s human capital. The most obvious is the legitimate concern about political instability. Another discouraging factor is the incomplete nature of the business environment. Concerns about the quality of education, healthcare and other family-related matters do not help. Despite these shortcomings, talented individuals still consider moving to the region — on condition that they can operate in professional firms that provide them with an attractive value proposition.

Premium professional services firms, such as management consultancies, have been widely recognized as providing an attractive context to encourage people to return. This is not limited to ‘above the market’ financial compensation. Other important elements include a clear meritocracy-based career path, an exposure to solving strategic problems for clients, a culture that encourages entrepreneurship, the opportunity for continuous learning and development, the ability to receive close mentoring and strong brand recognition. Finally, by participating in a professional services firm, dedicated and talented people can realistically see themselves making a much needed contribution to the region’s economy.

All these elements are a permanent part of the value proposition of these firms. The leaders of these companies know that high end professional services depend upon deep and constantly refreshed expertise. Consulting professionals build long term, productive relationships with business executives. They think innovatively about their clients’ most complex challenges. They must keep acquiring knowledge, sharpening their skills and sharing expertise with their colleagues.

We have found that job candidates place substantial weight on whether a potential employer’s expressed values fit with their own personal values. The questions they consistently ask are: Does the company encourage a ‘get up and go’ spirit? Will it listen to, and support, individuals’ long term growth? Are senior leaders committed to having top level staff coach their juniors and does the firm encourage apprenticeship? Are clients and their information treated with care and respect?

The connection to the client, the lifeblood of the business, depends upon trust. Organizations, whether private enterprises or governments, are sharing their most sensitive information with external advisors and service providers. The phrase ‘trusted advisor’ is not a slogan. It expresses what every client demands and every consultant must be if they want to have a sustainable advisory business. Clients want to know that they are dealing with people who do more than comply with ethical standards. They want advisors who incorporate ethics into how they operate. Strategy& integrates two sets of ethical codes into its work, those of the firm and of the PwC network of which we are a member. Other firms may also use more than one ethical code.

This commitment to a clear set of corporate values is particularly important because talented staff are so mobile and, in our region, in short supply. More business people need to understand the importance of attracting talent; doing so successfully is critical to every company that hopes to thrive in the Middle East in the future.

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Economics & Policy

Where’s the beef?

by Matt Nash
written by Matt Nash

The most conspicuous result of Beirut Governor Ziad Chebib’s November decision to close the city’s main slaughterhouse because of unsanitary conditions is the lack of impact it had on the market. The price of cattle and sheep meat remained stable as supply was, apparently, completely uninterrupted.

[pullquote]Chebib says he does not know where the butchers who were using the slaughterhouse are currently practicing their trade[/pullquote]

“Are you still eating the meat in Lebanon?” Chebib asks Executive. After receiving an affirmative reply, he continues, “this means the market is in chaos.” Chebib says he does not know where the butchers who were using the slaughterhouse are currently practicing their trade, but notes that if there are more slaughterhouses in Beirut, “they are illegal.” He says that the Municipality of Beirut’s 13 health inspectors are on the lookout for outlaw abattoirs and insists his decision to shutter the slaughterhouse was not directly related to Minister of Health Wael Abou Faour’s food safety campaign, launched in late 2014. “I was nominated in May, and I had many, many, many problems and files. When I opened this file, I found that something had to be done, and I’ve done it. That’s what happened.”

Cheap rent

The 1977 law that governs municipalities gave them authority to “[protect] individual and public health” and “[ensure] the health control” of “all the places in which food or beverages are manufactured and sold” within their jurisdiction. This includes slaughterhouses. In the case of Beirut, the municipality is in direct control of the abattoir, and its general director is a city employee. Chebib, who left his job as a judge when appointed governor, does not elaborate when Executive asks what legal justification the city has for actually running the abattoir — after all, the city doesn’t run all of the restaurants within its jurisdiction. Instead, he explains that it is a result of a tradition dating back to the Ottoman era.

The current slaughterhouse was built in 1994 and was intended to be a temporary facility. Like many things temporary or interim in Lebanon, however, 21 years later, no permanent alternative has been found.

Joseph Mounem, director general of the slaughterhouse, explains that its existence was the result of a postwar compromise. In 1966, the city built a slaughterhouse in the Karantina neighborhood, according to a mid 1970s magazine detailing city accomplishments that an advisor to Chebib showed Executive. 

War forced the building’s closure, and Mounem explains that by the early 1990s, the butchers who once used it were instead slaughtering animals in the then-largely destroyed Camille Chamoun Sports City Stadium on the southern edge of Beirut’s city limit. When the government decided to rebuild the stadium, the butchers had nowhere to go, Mounem says. Instead of paying them to leave via the Fund for the Displaced, a compromise was reached. The old slaughterhouse was by then a Lebanese Army position, so the city built the butchers a new slaughterhouse in 1994 near the port on land owned by the government until they could be relocated. That never happened, so the meat traders — who numbered 20 in 1994 but only 12 today, Mounem explains — continued work in favorable financial conditions. Mounem says each week between 900 and 1,300 sheep were slaughtered in the facility along with between 170 and 225 cattle. He explains that the butchers paid a municipal tax of LBP 5,000 ($3.33) plus VAT per head of sheep and LBP 10,000 ($6.67) plus VAT per head of cattle. When the municipality tried to raise the tax on sheep by LBP 1,000 ($0.67) and the tax on cattle by LBP 2,000 ($1.33) in 2000, the butchers protested and eventually forced the municipality to rescind its decision in 2003, Mounem says. Executive has been unable to reach any of the butchers.

[pullquote]Many argue that the Beirut slaughterhouse should be moved[/pullquote]

Data deficiency

Information on the country’s meat market is scarce. According to Mounem’s figures, the Beirut abattoir accounted for 8,840 to 11,700 slaughtered cattle and 46,800 to 67,600 sheep annually. Statistics from the UN’s Food and Agricultural Organization, covering 2010–2011, show that during that year, there were 63,000 cows and 375,000 sheep in the country, but does not say how many were slaughtered in that period. Executive has not been able to find a breakdown of the meat market, and could not reach Maarouf Bekdash, president of the meat traders’ syndicate, for comment.

As for the future of the Beirut slaughterhouse, many argue that it should be moved. Municipal Council member Hagop Terzian tells Executive that there are both political and sectarian reasons why the abattoir has remained where it is for so many years, but refuses to elaborate on exactly what that means. Asked why no previous governor had addressed the unsanitary conditions at the slaughterhouse, Chebib offers, “I don’t look behind me.” He says the building is currently being renovated but did not follow through on a commitment to give Executive the refurbishment plans. That said, he admits he also wants to move the slaughterhouse and explains, “We are studying the map in Beirut and its suburbs. There is a tradition that Beirut must have a slaughterhouse, but that doesn’t mean it has to be in Beirut.”

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Economics & Policy

Prognosis growth

by James Haines-Young & Maya Gebeily
written by James Haines-Young & Maya Gebeily

Perhaps the first thing refugees fleeing a war zone need is medical attention. It is no surprise, then, that Lebanese hospitals have been busier than usual since war engulfed Syria in 2012. According to a recent UNDP study, in fact, in 2014, humanitarian aid inflows focused on Syrian refugees have spurred 1.76 percent in additional growth for the healthcare sector, according to a UNDP study. That year, UN agencies and affiliates supported 180 primary healthcare centers and 65 hospitals throughout Lebanon. With a swell of new patients, particularly in 2013, hospitals have experienced positive growth and have consequently invested in their infrastructure and service provision. “When these hospitals have more business, they are going to buy more medical supplies and more medications from pharmaceutical companies,” says Walid Hallassou, general manager of GlobeMed Lebanon. GlobeMed is the third party administrator that UNHCR has contracted to help it manage its healthcare response. “They are going to employ more doctors, more nurses and so on,” he adds.

[pullquote]Over $1 million were used to purchase roughly 6,200 items of medical equipment for primary healthcare centers in 2014 alone[/pullquote]

At times, healthcare facilities also received direct, in-kind aid from UN agencies. Over $1 million were used to purchase roughly 6,200 items of medical equipment for primary healthcare centers in 2014 alone. Hospitals, primary healthcare centers and even the Ministry of Public Health also received training for staff and support to hire new professionals — at least 81 new professionals were hired with direct UN support in 2014, according to the UN. 

Healthcare aid to refugees and affected Lebanese communities has also included direct provision of medication, which has sparked growth in Lebanon’s pharmaceutical sector. According to a 2015 Business Monitor International report on Lebanon’s healthcare expenditures, pharmaceutical sales in Lebanon jumped from $1.3 billion in 2012 to $1.46 billion in 2013 — and then again to $1.59 billion in 2014. Pharmaceuticals are also playing a bigger role in Lebanon’s economy: drug sales as a percentage of GDP increased from 3.05 percent in 2012 to 3.37 percent in 2014, the report found. As part of the support to affected Lebanese communities, $6 million worth of pharmaceutical products were purchased by UN agencies and distributed to primary healthcare centers and hospitals. Unfortunately, numerous pharmaceutical companies contacted by Executive — including Omnipharma, BroadMed, Omnilab and Medex — either did not respond to requests to comment or declined to provide any information about particular growth within their companies. 

There are also a number of intermediaries who have experienced growth as a result of aid — not least of which is GlobeMed. Contracted by UNHCR at the end of 2013, GlobeMed manages the secondary and tertiary levels of healthcare provision for Syrian refugees and is the refugees’ point of contact for healthcare issues. Partnering with UNHCR has brought multiple dimensions of growth to GlobeMed. 

“For an organization that used to serve about 500,000 lives in Lebanon to take on another 700,000 overnight was not an easy task,” Hallassou tells Executive. “We recruited a lot, we opened offices, we bought equipment, we had system developments to do.” 

However, these investments are made warily. Describing UNHCR as a “high risk client,” Hallassou says GlobeMed — and other firms in the healthcare sector — are painfully aware that their contracts are valid only so long as UN agencies continue to have steady funding. This precarious situation means that GlobeMed manages its growth carefully, apprehensively, and on a short term basis. 

[pullquote]Hallassou is skeptical that the quality of the healthcare system as a whole in Lebanon has been buoyed by international aid[/pullquote]

“Usually our employees are on unlimited contract[s] — now we need to recruit employees on a limited basis. They are brought in as consultants or employees with limited contracts so that we protect them and we protect ourselves,” Hallassou admits. Purchasing new equipment to manage the refugee workload works the same way — GlobeMed’s management has to continuously consider whether new systems or pieces of equipment can be used for other projects if its UNHCR contract abruptly ends. Still, Hallassou says, the contract has been worthwhile from a business point of view. 

That view might not extend to the long term. Hallassou is skeptical that the quality of the healthcare system as a whole in Lebanon has been buoyed by international aid. While there may well be improvements in some institutions, this is not represented across the industry. As long as hospitals and primary healthcare centers have “weak foundations” in infrastructure and service provision, he says, new equipment and new staff won’t boost quality. The conclusion is worrisome: although humanitarian aid money may be providing the sector a profitability boost today, the long term implications of this capital injection may prove to be minimal.

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Business

All grown up

by Livia Murray
written by Livia Murray

Some are starting to see it. As the world moves to the web and mobile, leaders of industry are beginning to see changes happening from their vantage points at the top of the chain of command. They also see threats to their positions. The term ‘burning platform’ refers to the idea that traditional industries can’t stay immobile because the platform under their feet is on fire. As the world moves from non digital to digital, leaders of traditional industries are beginning to adapt and innovate in this space in a bid to remain competitive in their markets and stay relevant.

The transformation has had an impact on many sectors globally, ranging from the media — with the onslaught of social networks, videos and new forms of content — to transportation which is starting to see a violent disruption from Uber, to banking which has seen a proliferation of financial technology companies and vertical accelerators focused on banking. Some giants are starting to move into this space, such as the partnership between financial giant Barclays and startup accelerator TechStars in London.

[pullquote]CEOs of traditional industries in Lebanon are not yet fully cognizant of the degree of change the digital revolution will bring[/pullquote]

This change has been slower in the Middle East. As Executive caught up with Omar Christidis, founder and CEO of tech conference business ArabNet, in the leadup to the sixth ArabNet Beirut conference, he claimed that CEOs of traditional industries in Lebanon are not yet fully cognizant of the degree of change the digital revolution will bring. “I think that is going to certainly reshape the industry. I think that it is going to have a more drastic impact than most CEOs expect — on all industries,” he says.

Corporates in the crowd

But to some, the change is becoming increasingly evident. Already, we can see the lineup of this year’s ArabNet Beirut integrating many more corporate elements than in previous rounds. Among the speakers representing the traditional industries are Neemat Frem of Indevco and Nayla Tueni of An-Nahar, who are coming to speak about how the shift to digital is changing their industries.

While some of them may be there due to the pull factor — i.e. Christidis and his team’s enthusiasm to welcome corporates to the digital world — some are legitimately starting to see their industries change under their feet. “The industries that have been disrupted harder are the ones where the CEOs have had more of a burning platform and have had to figure it out. And I would say media is one of those sectors, I would say it has been one of the fastest transformed of all the sectors.”

Having more speakers from traditional industries interested in web and mobile has been a key focus for Christidis in Lebanon, as having big players in traditional industries as potential clients for web and mobile companies would naturally be a boon to the sector. “They’re the biggest spenders in our economy. So if we want to move dollars, budget, into digital — whether that’s services, advertising, whatever — we need to get these guys to focus more on their digital platforms.”

[pullquote]“The extent of the disruption is bigger today than anyone imagines it”[/pullquote]

And looking towards the future of disruption in traditional industries, Christidis points to banking as the next big sector to witness an overhaul. The Lebanese banking sector in particular is the perfect potential client due to its size and profitability. While banks have always made heavy investments in tech — from the first core systems to ATMs to online and mobile banking and digital trading technology — Christidis claims that awareness about the transformations in banking is still shy. “We’re only seeing the tip of the iceberg in terms of the disruption in this space,” he says. “The extent of the disruption is bigger today than anyone imagines it.”

ArabNet goes corporate

The panel speakers at the conference are not the only things that have become more corporate. ArabNet itself has grown considerably since its first conference in Beirut in 2010 when it was itself still a startup. Five years later, with conferences in Saudi Arabia and the UAE under their belt, it has turned into a successful conference business of regional scale that, according to Christidis, has been profitable since day one.

The company has grown 30–40 percent per year over the past three years and recorded revenues of over $1.5 million in 2014 according to Christidis. Saudi Arabia is its biggest market in terms of revenues, followed closely by the UAE then Lebanon, he says. Saudi is also the fastest growing market and represents about one fourth of its revenues. This is in contrast to three years ago, when Lebanon represented 100 percent of business. Today the country represents about 25 to 30 percent, according to Christidis.

[pullquote]ArabNet has also branched into media both through online content and most recently with a quarterly print magazine[/pullquote]

With the events the most profitable business segment, currently making up 95 percent of revenues, ArabNet has also branched into media both through online content and most recently with a quarterly print magazine, which the company hopes to keep investing in. It is certainly no dull time to invest in media: the landscape is seeing a massive overhaul as outlets are either drastically changing to adapt to the digital space or dropping out of the race entirely. Christidis, however, is confident that the print magazine can be a sustainable business, citing still existing large budgets for print advertising.

ArabNet’s most recent business endeavor, however, is still for the most part in its ideation phase. The next venture, says Christidis, is in business intelligence, including industry reports and business matching. While Christidis notes that the model for commercialization is not yet clear for this segment, he sees great opportunity in this domain as the web and mobile industry is severely lacking in data.

This would also be a great boon to the sector. “For us, to move the industry forward, I think this is one of the key challenges. We need to have industry level data. We need to chart our own growth as a sector.” In line with these initiatives, the company is currently fixing up its database, cleaning its data and investing internally in knowledge management.

Last summer, ArabNet joined the Endeavor network, a nonprofit that helps businesses scale their growth through mentorship and access to market, through which the company hopes to further grow and institutionalize the business. Christidis explains that the decision to pursue business intelligence was partly informed by the Endeavor process, which encouraged ArabNet to see the added value their insights, understanding and relationship with the market could bring to a business intelligence operation. Endeavor also pointed out that this would be a highly scalable segment of the business.

Institutionalization

With great growth, however, also comes greater need for institutionalization. As the company has never raised external funding, it remains in the hands of Omar Christidis and his mother Anbar Nashashibi, with a fifty–fifty partnership. Christidis explains that while legally they are not required to set up specific corporate governance practices, they see the institutionalization of the business as being important for the positive connotations that good governance entails.

[pullquote]”Family businesses have a bad reputation, especially among the younger generation”[/pullquote]

“Family businesses have a bad reputation, especially among the younger generation. They see them as kind of nepotistic and places where you can’t advance, places where there are no clear systems or policies, kind of chaos,” he says. “It’s really important that the company not be run like a family business … It’s an important thing that we have continued to invest in — to make sure that we have the systems and structures and policies, the staff feels that they are empowered to make decisions, that they’re not going to get whimsical decisions from family members.”

Family involvement in the business includes Christidis and his parents, Nashashibi and father Theodore Christidis. Nashashibi serves as the chair and supports them with VIP and government relations, while the elder Christidis advises and oversees the financials. Prior to ArabNet, Christidis was involved in Nashashibi’s event management company International Business Alliance Group (IBAG) as vice president.

The company is currently in the process of setting up a board of advisors with the guidance of Endeavor, says Christidis, and also hopes to have a board or directors within the year. With two legal entities in Lebanon and one in the UAE, it is currently in the process of structuring its corporate holdings in a way that makes sense for an investor or partner to come in.

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Economics & Policy

Misplaced blame

by Jeremy Arbid
written by Jeremy Arbid

For many Lebanese, from government ministers to taxi drivers, the cause of the country’s economic downturn is clear: 1.16 million Syrian refugees. While a population increase of more than 25 percent has certainly strained infrastructure and further challenged the state’s ability to provide basic services, the notion that the refugees are directly responsible for sluggish GDP growth since 2011 simply does not correspond with the facts. Mirroring its regional neighbors, the Lebanese economy began to cool down as large scale, antigovernment protests moved from one Arab country to the next, beginning in Tunisia in late 2010. The uncertainty the so called Arab Spring inspired helped drag Lebanon’s GDP growth down to 2 percent in 2011 from 8 percent in 2010. The Lebanese economy has been in crisis mode since. Since 2011, the country’s exports have consistently decreased, consumer confidence has steadily declined and the inflows of foreign direct investment into Lebanon have plunged sharply, with demand for high end real estate also falling. Meanwhile, tourism and hotel bookings have dipped in line with travel warnings and bans from GCC governments, citing numerous bombings and other security incidents that have destabilized Lebanon in recent years.

By February 2012, according to the UN, months of protests in Syria had turned into civil war. The conflict in Syria has disrupted traditional trade partnerships and transit routes for Lebanon, but in the first nine months of unrest few refugees headed to Lebanon. By January 27, 2012 — the earliest reference date available on its website — UNHCR had registered only 6,290 Syrian refugees in Lebanon, though economic growth for 2011 had already dropped significantly compared to the previous year. The violence in Syria, however, intensified, forcing more and more Syrians to flee their homes in search of safety — an estimated 7.6 million Syrians are internally displaced, according to November figures from the Internal Displacement Monitoring Center, and an additional 3.7 million Syrian refugees are currently registered with the UNHCR in Lebanon, Turkey, Jordan, Iraq, and Egypt, with the largest number residing in Lebanon.

Previous research had indicated the spillover effects of the conflict in Syria had significantly affected the Lebanese economy. For example, a World Bank report from 2013 identified losses to economic activity, income and public services, and noted direct and indirect impacts on trade and tourism as well as health, education, and other social services. The report estimated that the Lebanese economy would incur a cost of $7.5 billion by the end of 2014 due to the refugee influx. That said, new research from the United Nations Development Program (UNDP) shows that hosting these refugees has not been a total loss for the Lebanese economy. With the refugees came a steady flow of humanitarian aid that has helped mitigate losses incurred from the conflict in general and from the refugee situation in particular.

[pullquote]The results found that each dollar spent by beneficiaries generated $2.13 for the Lebanese economy[/pullquote]

A 2014 study by the International Rescue Committee was among the first to consider whether the refugee ‘burden’ had any positive implications upon the Lebanese economy. UNHCR’s winterization program disbursed $41.4 million in cash, channeled via ATM cards, over a three month period beginning in January 2014. The results found that each dollar spent by beneficiaries generated $2.13 for the Lebanese economy — i.e. a multiplier effect of 2.13. However, the study is problematic for two reasons. First, it uses a general mathematical formula not specifically tweaked for Lebanon to compute a multiplier effect and, second, it uses the spending habits of Jordanians as a basis to estimate how Syrian refugees in Lebanon might have spent aid money.

The more recent UNDP study written by the Consultation and Research Institute (CRI), a Lebanese company familiar with the local economy, found that an estimated $800 million in humanitarian aid that flowed into the Lebanese economy in 2014 brought with it a 1.6 multiplier, meaning every $1 in humanitarian aid resulted in $0.60 in extra spending. The report does not offer a picture of growth in the entire economy for 2014, yet assuming all other factors are constant, it shows that humanitarian aid had a 1.3 percent contribution to Lebanon’s GDP. Adding context, the study factors in losses in tourism and exports in 2014 — “While it helped mitigate the effects of the refugee crisis, the humanitarian package did not completely offset those effects,” the report notes, concluding that “the combined effect of a 23 percent decrease in tourism volume, a 7.5 percent decrease in exports, and the injection of the same aid package ($800 million) results in negative GDP growth of -0.3 percent instead of the initially obtained positive growth of 1.3 percent.” Without the aid money, the study notes, tourism and export losses would have dragged growth down by 1.6 percentage points.

Ceteris paribus

“We wanted to understand, if we inject $800 million into the economy, spent in the particular manner they were spent in, how much you would have a multiplied impact into this economy,” Rola Rizk Azour, a senior economic advisor at the UNDP, explains. Azour also clarified that “we consider the economy [to be] a closed box. We insert the $800 million received and — barring any other changes in the environment — [measure] what is the outcome. We wanted to see where this humanitarian assistance has had the most impact.” To do this the UNDP contracted CRI to simulate the effects of humanitarian spending on the economy in 2014 using expenditures of the four UN agencies from that year — estimated at $800 million.

The exercise measured which economic sectors were affected via the distribution of humanitarian aid. As expected, Azour points out, aid money was spent primarily on food products (27 percent) related to the World Food Program card voucher program. Other sectors where aid spending concentrated were: real estate (which includes rent, 14 percent), chemicals (i.e. medicine and gasoline, 9 percent) and education services (7 percent). The humanitarian aid spent according to the distribution keys within the simulation had an overall multiplier effect of 1.6, Azour explains. 

“It’s a huge number crunching exercise — [and tells] only part of the story of this economy,” she says, adding that the UN system and humanitarian aid should not be celebrated for any growth the economy might record for 2014. The report cuts straight to the point in its conclusion, and Azour stresses the notion, “while it helped mitigate the effects of the refugee crisis, the humanitarian package did not completely offset those effects.”

[pullquote]Humanitarian aid flowing into Lebanon was not the only thing affecting Lebanon’s GDP for 2014[/pullquote]

Azour repeatedly points out that the humanitarian aid flowing into Lebanon was not the only thing affecting Lebanon’s GDP for 2014 — “there were other factors in this economy that were also not taken into consideration, like the stimulus package of the [central bank].”

Lebanon’s central bank introduced its first stimulus package of $1.4 billion in 2013, which the bank says contributed 1.5 percent to GDP growth that year. The bank injected another $800 million into the Lebanese economy in 2014, though about half of that was leftover money from the previous year’s package, Executive has reported. The bank’s governor, Riad Salameh, announced in October another stimulus package of $1 billion for 2015.

Clearly the results of the simulation show that aid distributions centered on the staple items of food, housing and medicine to alleviate suffering and mitigate the refugee crisis that the war in Syria instigated — the UNHCR and the WFP are among the largest distributors of these subcategories of aid in Lebanon. The study, it should be noted, looked at only four UN agencies delivering humanitarian aid in Lebanon — UNDP, UNHCR, WFP and UNICEF. While the four account for “at least 70 percent of UN humanitarian aid within the context of the Syrian refugee crisis” in Lebanon, the study reports that other donor money arriving through other channels was excluded, meaning the true impact of humanitarian aid money was not fully assessed. 

Living on little 

The aid Syrian refugees have received has been significantly inadequate. Due to the shortfall in funding, the WFP announced in December that it had suspended payments of food aid to Syrian refugees, not only those in Lebanon but also across the region.

In 2014, organizations distributing humanitarian aid in Lebanon received only 50 percent of the $1.7 billion appealed for in that year’s Syria Regional Refugee and Resilience Plan. Ninette Kelley, head of the UNHCR in Lebanon, addressed the impact of funding shortfalls to the organization in a December interview with Executive saying, “the level of assistance that we can provide continually needs to be heavily targeted and we’re simply unable to meet all needs.”

In the Syria Regional Refugee and Resilience Plan for 2015, humanitarian organizations, including the UN agencies, have appealed for $4.5 billion to address the refugee crisis across the region. As of late February, those organizations distributing aid in Lebanon have received only 3 percent of the nearly $2 billion requested in appeals.

Preparing for a long war

The UN Commission for Inquiry on Syria — set up to investigate violations of international human rights occurring during the country’s four year civil war — said last month in a press release announcing its latest report that “unthinkable crimes continue to occur daily in Syria.” The report neither implies that stabilization in Syria is likely soon nor does it suggest Syrian refugees will be able to safely return to their homes in the near future. That is to say the refugee crisis will likely continue for years to come.

The outlook is grim. The ongoing war in Syria suggests that Lebanon’s economy will continue its poor performance due to the turbulence and barriers to economic stability that an unpredictable security situation implies. Likewise, funding shortfalls in humanitarian aid donations means less money that refugees can spend in the Lebanese economy on basic necessities for their families. Syrians seeking refuge in Lebanon have no other choice but to stay and scrape by. But addressing the immediate needs of refugees is not Lebanon’s only dilemma — the country is also concerned about crumbling physical infrastructure and the declining quality of health and education services. The World Bank estimated in 2013 that $1.6 billion would be needed to maintain access to quality health, education and social safety nets for the period 2012–2014, and investing in these services has been found to have a significant impact on economic growth in the long term.

Due to the state of Lebanon’s infrastructure, the international community needs to support the country in maintaining service delivery to refugees, the president of the World Bank Jim Yong Kim noted during a school visit in Beirut in June 2014.

“The data now is overwhelming,” Kim says in a recent interview with Freakonomics Radio, “in that investments in health and education, for example, are critical aspects of a growth strategy [and that] fundamental investments in human capital lead to growth.” A group of economists, led by Lawrence Summers — a former director of the National Economic Council advising US President Barack Obama — wrote in Global Health 2035 that “the returns on investing in health are impressive,” with the study concluding that in low and middle income countries roughly 24 percent of economic growth experienced between 2000 and 2011 was due to better health outcomes.

[pullquote]Lebanon’s economic woes will not simply evaporate[/pullquote]

With no end to either the refuge or economic crises in sight, Lebanon will need support to maintain and improve its basic services such as water, sanitation and roads, as well as in social services like health and education. To do this, the World Bank had partnered with Lebanon’s government to establish a multidonor trust fund in March 2014. “The Bank deals with development issues,” writes Mona Ziade, a communications officer in the World Bank’s Beirut office, in an email to Executive, adding that the fund “is strictly for development projects that will help boost the resilience of the Lebanese host communities.” Derek Plumbly, former UN Special Coordinator for Lebanon, remarked in a statement announcing the fund that “this is the only one established specifically to provide assistance to the government and municipalities, established specifically to mitigate the impact of the Syrian crisis.”

Lebanon’s economic woes will not simply evaporate — more humanitarian and development aid will be needed in the coming years. Aid will continue to help Lebanon alleviate refugees with money to be spent meeting basic needs of food, clothing and shelter, that does flow back into the economy; similarly, development aid will help Lebanon to invest in maintaining infrastructure and services, setting up the economy for future growth.

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Economics & PolicyWomen in the workplace

Second class citizens — or worse

by Jeremy Arbid
written by Jeremy Arbid

The subjugation of women — often unwitnessed, overlooked or otherwise ignored — is today’s greatest challenge facing equality among the genders in the Middle East, says Kenneth Roth, executive director of Human Rights Watch (HRW). In Beirut, presenting the organization’s annual global report on human rights practices, Roth spoke with Executive about women’s rights in Iraq, Saudi Arabia and Egypt and the severe oppression of women occurring in those countries.

Islamic State of Iraq and Syria

“The ideological suppression of women,” says Roth, in areas under the control of ISIS, namely Syria and Iraq, defines the now familiar barbarity central to the jihadist group. While much of the attention on ISIS, for Western media, has focused on its execution of prisoners, it is ISIS’ treatment of women — albeit underreported — which underlines its rights violations. 

Among its most acute atrocities, Roth explains, is the group’s treatment of Yazidi women — a Kurdish sect traditionally concentrated in the northern Iraqi province of Nineveh. In HRW’s 2015 World Report, Roth wrote that ISIS “militants have enslaved, forcibly married, and raped Yazidi women and girls.” In 2014, the Syrian Observatory for Human Rights, an advocacy group, reported documented cases of Yazidi and Syrian women kidnapped into slavery. The organization said it also has evidence of Yazidi women sold into marriage to ISIS fighters for $1,000 each. Roth adds that ‘marriage’ under ISIS is really a “euphemism for forced rape,” and that it epitomizes ISIS’ utter disregard for women as human beings.

Coming upon an abandoned ISIS military checkpoint, Iraqi Special Forces and Kurdish Peshmerga found two women naked and chained who had been raped multiple times, The New York Times reported in August. To supplement its insatiable domineering appetite, ISIS — in Al-Bab, a city in the Aleppo province of northern Syria — has set up a so called marriage bureau to wed single women and widows to the jihadist group’s fighters. “They’re really almost just treated like chattel and handed out to fighters as sort of the prizes of war,” Roth says.

ISIS, in defending its actions, has referred to the Quran to justify its kidnapping, subjugation and forced rape of Yazidi women. In ISIS’ fourth issue of Dabiq, its English language online magazine, the group notes that “women could be enslaved” and that upon their capture “the Yazidi women and children were then divided according to the Shariah amongst the fighters of the Islamic State.” The maliciousness of the jihadist group is not unique, Roth says, adding that “in many ways it harkens back to the Taliban era in Afghanistan or to some of the abuses in Saudi Arabia.”

Saudi Arabia

“Under King Abdullah, there seemed to be some commitment to improving the rights of women. I say some because he operated very slowly, very incrementally,” Roth explains. While women’s rights in Saudi Arabia are undoubtedly not favorable, a slow moving effort towards granting more rights to women has begun in the last few years. 

Listing the improvements, Roth explains that not too long ago, in 2011, the late king declared women would be able to vote and run in the 2015 municipal elections, as well as be eligible for appointment to the Shura Council — 30 women were appointed in 2013. There has also, he says, been a gradual increase in the professions that are available to women.

Saudi statistics on its labor force demonstrate the kingdom’s inclusion of local women. While certain types of professions might still be off limits to Saudi women, their access to the labor force has increased markedly in the past five years. Of the total Saudi female population 20 percent were employed or actively looking for jobs in 2014, according to Saudi Arabia’s Central Department of Statistics and Information 2014 labor force survey. But in 2009 that figure stood at only 12 percent: in five years the number of economically active Saudi women has increased by over 1.1 million. 

The statistics portray just one angle of Saudi Arabia’s incremental approach towards female inclusion in the labor force. An advisor to the Saudi Ministry of Labor described proposed policies to The New York Times in November to promote female labor force participation — the building of childcare facilities nearer to places of work and the creation of jobs in the industries of healthcare, manufacturing and information technology — which, if implemented, could further open the door to the labor market for Saudi women.

While Roth acknowledges this as a positive development, he counters with what he describes as the main obstacle for Saudi women willing to work: the archaic guardianship law. Under the law, the most basic decisions in a woman’s life cannot be made without the consent of her male guardian. This lack of agency, Roth says, makes it very difficult for Saudi women to operate in modern society. Were a woman to find gainful employment in the kingdom, she must still obtain permission to show up for the job and she still cannot drive herself, he adds. 

Roth also points out that the change that began under Abdullah is not certain to continue. His organization has no idea where King Salman stands on women’s rights. “We still have a blank slate on this, and he himself is old and incapacitated, so it’s just not clear how much he is going to be able to push things forward.” Some reticently voice their concern. The recent appointment by Salman of Muhammad Bin Nayef as deputy crown prince and second in line to the throne is troubling news for women and human rights advocates, an anonymous letter to the new king published in Politico points out. And Roth agrees; under Abdullah, Bin Nayef served as minister of the interior where he orchestrated the detainment of female drivers, impounding their vehicles. In one rare case, two female drivers were referred to a court established to try terrorism cases — not for driving, but for speaking about the incident on social media. Bin Nayef, says Roth, has “given no indication that he is going to pursue or let alone build upon King Abdullah’s willingness to countenance a slight opening for the rights of women.”

Egypt

For Roth, female genital mutilation (FGM) remains one of Egypt’s most destructive women’s rights violations, and the practice is considered as a form of torture under the UN Convention against Torture and Other Cruel, Inhuman, or Degrading Treatment or Punishment. According to UNICEF, an estimated 125 million women around the world have undergone the procedure. The practice of FGM in Egypt remains high — 91 percent of women between the ages of 15 and 49, which represents 27.2 million Egyptian women — have been subjected to cutting of external female genitalia, including partial or total removal of the clitoris, according to a 2013 UNICEF report. FGM was banned by the Egyptian government in 2008 — yet implementation of the law has not been a priority. But years of activism and education by Egyptian civil society, Roth says, may be dispelling the cultural taboo of questioning FGM leading Egyptians to think of it as a widespread problem of public health and human rights abuse.

In January 2015 — in the first instance Egypt has applied the law — a doctor was convicted of manslaughter for performing FGM on a 13 year old girl, forced by her father to undergo the procedure, who died soon after. The doctor received a two year prison sentence, the maximum allowed under the law, while the father received three months of house arrest. In response to the girl’s death, local activists launched the Kamla campaign aiming to eliminate the practice of FGM under the slogan “Our daughters are complete. Why do we want them to be incomplete?”

While Roth does highlight the significance of the conviction, he also clarifies with context — several years of internal turmoil and struggle have intensified what was an existing problem: the sexual harassment of women in public. HRW reported in July 2013 that 91 women were raped or sexually assaulted during protests against then President Mohamed Morsi in Tahrir Square that June. Similarly, a graphic YouTube video, first posted in June 2014 but believed to be dated much earlier, depicted a woman stripped naked, assaulted and dragged through the middle of Tahrir Square as she attempted to escape a large group of male assailants. The public harassment of women on the streets of Egypt, Roth points out, is “indicative of a broader disregard for women and the treatment of them not only as second class citizens but people who can be freely abused.” Indeed, statistics from UN Women put it bluntly — 99.3 percent of Egyptian women and girls surveyed in 2013 said they’ve been subjected to one form of sexual harassment or another. 

A tough future

Though there have been occasional and modest steps towards equality between the genders, the unrest raging across the region makes significant achievements and improvements for women’s rights difficult. “Women,” says Roth, “continue to suffer severe repression in most countries of the Middle East. There are major countervailing pressures and a lot of the big steps towards basic equality and women’s rights have not been taken by many of the governments in the region.” Where they can, women are fighting back.

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Last Word

(Un)happily ever after

by Nadim Houry
written by Nadim Houry

All couples hope their marriages will work out and they will live happily ever after. But the truth is that many relationships end in divorce and Lebanese couples are no exception. According to a 2012 study by the Lebanese Central Administration of Statistics, there were almost 6,000 divorces in 2010. The issue for these couples and for society at large is how to ensure a fair separation that guarantees the rights of each spouse and protects their children.

On that front, Lebanon is failing miserably to ensure fair treatment of women. It is widely known that Lebanon does not have a civil code regulating personal status matters. Instead, there are 15 separate personal status laws for the different recognized religious communities, which are administered by separate religious courts. Human Rights Watch (HRW) recently reviewed 447 legal judgments issued by these religious courts to examine how they handle divorce, child custody and financial issues emanating from separations or divorce. The cases, dating from 2009–2012, were selected at random.

[pullquote]Lebanon’s religion-based laws discriminate against women across the religious spectrum[/pullquote]

The findings were troubling. Lebanon’s religion-based laws discriminate against women across the religious spectrum. Women had lesser rights than men to ask for divorce. Under Lebanon’s Shia, Sunni and Druze laws, men can demand a divorce at any time — unilaterally, and without cause — while a woman’s ability to access divorce is limited, and often at great cost and after lengthy court proceedings. In principle, Islamic laws allow women to have an explicit clause inserted into the marriage contract stating that the wife can also have an equal right to unilateral divorce, but this right is rarely exercised due to social customs. Only 3 of the 150 divorce judgments before Islamic courts that HRW reviewed included such clauses. While divorce is difficult for both men and women under Christian laws, Christian men find it easier to circumvent these restrictions, including by converting to Islam and remarrying without divorcing.

As a practical matter, many women who spoke to HRW said these restrictions meant that they were forced to stay in abusive marriages — at great risk to themselves and their children, and that in some cases they had to give up their financial or custody rights in exchange for a divorce. Some women even had to pay their husbands to seek the divorce.

Women also face discrimination in relation to distribution of marital property after a marriage ends. Lebanese law does not recognize noneconomic contributions to a marriage or the concept of marital property, so after a separation property reverts to the spouse in whose name it is registered — typically the husband — regardless of who has contributed to it or what role a wife may have played in supporting her husband throughout their marriage.

In addition, even though the Druze and Christian confessions require the spouse responsible for the termination of the marriage to compensate the other, in practice these amounts are usually not enough to allow women to support themselves. In Lebanon’s Islamic courts, after a divorce, a woman is left with only the deferred mahr (dowry) stipulated in the marriage contract, but this is often just a symbolic figure such as one lira or one gold coin.

Discrimination also extends to one of the most difficult aspects of any separation: child custody. The HRW review of court cases found that in many cases, judges removed children from their mothers, but not their fathers, on grounds of fitness due to ‘questionable’ social behaviors because of the mother’s supposed religious affiliation, or because she remarried instead of making these decisions based on the best interest of the child.

The fear of losing their children was so great that some women HRW interviewed stayed in abusive marriages, gave up their monetary rights, or did not remarry so they could keep custody. “I forced myself to bear beyond what a human being can take, all the injustices and violence,” said a Maronite woman who endured years of physical abuse but only sought a divorce after her children became adults because she feared losing them.

The current system is not only unfair. It is broken. Some couples are converting to different confessions to be able to get married while others are converting to get a divorce. And many couples are simply voting with their feet, getting on a plane to get a civil marriage abroad. Ending a marriage or determining who a child should live with after a divorce are difficult enough decisions. The least Lebanon can do is ensure that the laws are fair. It is time for the country to adopt an optional civil code that would ensure equal rights for all Lebanese who wish to marry under it. But it is also time to get the Lebanese state to exercise oversight over religious courts. Not all marriages last, but at least we should have laws that help to give them a happy ending.

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