Lebanon is presented with the most serious challenges it has faced in the past decade. The economy is struggling, the internal security situation deteriorating and the country’s neighbors pose real threats. But amidst everything, there are opportunities — not just in newfound offshore oil and gas but also within the country’s ingenious population.

As we head into 2013, what can be done to help the country unite, to overcome its challenges and ultimately to grow? Over the course of this week, eight influential figures will address seven important topics, each suggesting one proposal to help the country move forward. 

Today, Sami Atallah makes the case for regional councils.

To improve Lebanon’s democracy, we need to rethink our system of devolved government. Right now we have regional municipalities and municipal unions, but neither of them function properly. Instead I propose the introduction of regional councils to connect the country along non-sectarian lines and help it grow.

Municipalities and municipal unions: Failing us all.

Since municipal elections were reinstalled in 1998, they have no doubt reinvigorated local democracy, and provided an impetus for decentralization. However, municipalities remain administratively and fiscally constrained, limiting their service delivery to a fraction of their supposed responsibilities. The number of municipalities in Lebanon, which has mushroomed from 718 in 1998 to 985 in 2012, is too high for 4.5 million people in a tiny country. Croatia, for example, has the same population as Lebanon but five times the surface area, yet it only needs 429 municipalities.

Furthermore, 70 percent of Lebanese municipalities have a registered population of less than 4,000. Almost 400 municipalities do not have a single employee and another 400 have very weak municipal administration. The few municipalities that have the fiscal resources to hire qualified staff face bureaucratic hurdles in their hiring procedures. For instance, it took the municipality of Ba’aklin three years, 73 referrals, and up to 15 signatures to hire a treasurer.

On top of this, they simply do not have the financial ability to do their jobs. The total amount of spending by the municipal sector amounted 6.3 percent of central government expenditure (excluding debt), while their revenue was almost 9 percent. Both of these are significantly lower than the 12 to 15 percent found in many comparable countries.

In effect, municipalities have fallen into a vicious cycle: many of them have no staff to collect fees and taxes and without municipal revenue they are unable to hire staff. Consequently, many are unable to provide services despite the wide range of competencies given to them by law.

On top of these, there are municipal unions, which have become important stakeholders in the context of decentralization. Today, there are 48 unions, of which 35 were established in the last decade. These unions include a total of 680 municipalities as members and are responsible for two-thirds of the population of the country.

Municipal unions are supposed to provide public projects of common interest including roads, sewerage, garbage, slaughterhouses,firefighting, organization of transportation, co-operatives, and markets. Although some have been able to provide services and undertake development projects, their work is constrained by overlapping competencies between municipalities and unions, weak administrative capabilities, excessive procedures to hire municipal staff, and low fiscal resources to undertake developmental projects.

Time for a rethink

I believe it is time to rethink our system of local government. There is a need to redesign the system in an integrated way — helping poorer areas become better-linked to richer ones. This requires a new tier of government on a regional level.

Under such a plan, the central government would be responsible for functions of national concern — such as trade, defense, foreign affairs, criminal and civil law, and industrial policy — while municipalities would focus on hyper-local issues such as street-cleaning and garbage collection. In between, the newly-formed regional administrations would help ensure integrated development.

These councils would be given the responsibility for applying national laws to the regions, thus redistributing the competencies and responsibilities of municipalities, unions, regional councils, and the central government.

More importantly, these councils should be directly elected by citizens. This would enhance democracy, help us move away from sectarianism and break the stranglehold on power of the traditional political groups.

One of the major problems in Lebanon is the inability to directly elect the head of the major political institutions, meaning deals are made behind closed doors. If the heads of these councils were directly elected along non-sectarian lines, they would have a mandate to bring about change.

For these new councils to be effective, they must have the fiscal authority to set the tax rate as well as collect it. Hence there is a need to reallocate some of the taxes and fees currently collected directly by municipalities to regional councils where economies of scale are possible. Regional councils must be endowed with the tax administration to ef?ciently and effectively collect these taxes.

Although direct taxes and fees ensure a degree of ?scal independence, they are unlikely to cover the spending needed for regional administrations. Two additional sources of revenues must be channeled towards them: the first is from the Independent Municipal Fund (composed of 11 taxes which are used to finance municipalities) where a significant portion of its revenue could be transferred to regional administrations rather than spent by the central government on items that do not benefit smaller regions of the country. Second, there is estimated to be at least $1 billion in revenues collected over the years by the Ministry of Telecommunication that was not distributed to municipalities.

Although direct taxes and fees ensure a degree of fiscal independence, they will unlikely cover the spending needed for regional administrations. Two additional sources of revenues must be channeled towards them: The first is from the Independent Municipal Fund (composed of 11 taxes which are used to finance municipalities) where a significant portion of its revenue could be transferred to regional administrations rather than spent by the central government on items that do not benefit smaller regions of the country. Second, there is at least an estimated $1 billion of revenues collected over the years by the Ministry of Telecommunication that was not distributed to municipalities.

The Lebanese often bemoan the state of their democracy, but many feel powerless to help change it. These proposals could make a real difference to all our lives.

Sami Atallah is Director of the Lebanese Center for Policy Studies

Lebanon is presented with the most serious challenges it has faced in the past decade. The economy is struggling, the internal security situation deteriorating and the country’s neighbors pose real threats. But amidst everything, there are opportunities — not just in newfound offshore oil and gas but also within the country’s ingenious population.

As we head into 2013, what can be done to help the country unite, to overcome its challenges and ultimately to grow? Over the course of this week, eight influential figures will address seven important topics, each suggesting one proposal to help the country move forward. 

Today, Nada Zaarour makes the case for taking the environment more seriously.

A decade into the 21^st century, it is about time our citizens and politicians realized the economic, environmental and social benefits to be achieved from moving towards a low-carbon future.

Just mentioning the word ‘green’ brings to the minds of many Lebanese mistaken clichés of tree huggers, reduced economic growth, expensive products and unfeasible styles of living. But to meet the needs of the new technology-driven world, Lebanon has little option but to transform its economy and society into a green one.

It is increasingly clear that escalating climate change is destroying the globe’s natural ecosystem, with forests ravaged and rivers poisoned. Exacerbating the crisis, especially in cities like Beirut, is rapid population growth — not merely in terms of resource use, but also in terms of services and infrastructure. It is hard to avoid the basic conclusion that the ecosystem which underpins the Lebanese economy is shrinking at a rapid pace, leaving the poor particularly vulnerable.

Eventually, Lebanon’s economic development requires a list of financial and government policy-guiding mechanisms to ensure that ample investments are made into crucial areas. These would be tailored to embellish existing natural capital while simultaneously minimizing environmental risks. For these changes to happen, Lebanon will undoubtedly need fundamental reform, and I believe that there are four main steps to doing so.

See also:

Former Labor Minister Charbel Nahas on rethinking the economy

Roudi Baroudi on the country’s oil and gas

British Ambassador Tom Fletcher on foreign interference

Hicham Safieddine on the Syria spillover

Saleh Machnouk on disarming Hezbollah

First, we must develop and promote an efficient and fair transition to a green economy, including establishing fully-fledged fiscal and economic policy measures where market infrastructures encourage new investment. Second, tax reforms that encourage environmental sustainability should be proposed, along with a definite revision of the current inflated taxing measures. Third, we must drive market change through public expenditure, including at an individual level spending our money on environmentally friendly goods, and at a larger level encouraging the government to invest in cleaner infrastructure provisions and sustainable procurement.

Finally, and crucially, we need to foster a new awareness that while reforming the country’s unsustainable economic activity might be politically difficult in the short-term, moving towards a green economy in the longer-term is fiscally advantageous in every way.

Such moves require serious changes to the decision-making processes within institutions like the Ministry of Finance. The many governments that we have had in Lebanon since the civil war have tended to favor short-term, financial crisis strategies, supporting non-renewable energy at the expense of other sectors while continuing to exploit our natural capital. Yet the upcoming challenges are far too big to be dealt with by such short-sighted strategies and we must consider beyond the next few years.

There are benefits to be made as well. Globally, renewable energy investments are expected to reach $630 billion by 2030, up from $162 billion in 2009, and are expected to create an additional 20 million jobs worldwide. What might seem surprising is that many emerging and developing economies are already reaping the benefits of moving towards a green economy. One example, which demonstrates the multiple benefits that can be realized from promoting new green sectors — in addition to greening the traditional brown sectors — is the expected growth of certified biodiversity-friendly agricultural products from $40 billion in 2008 to $21 billion by 2020.

Lebanon must accelerate efforts to shift from this unsustainable ‘brown’ economic system to a low-carbon, resource-rich green economy. A country like Lebanon, blessed with the natural resources of wind and water, could easily lessen excessive dependence on fossil fuels, such as oil, gas and coal. We must not use the very new findings of offshore oil and gas to ignore this issue, as if we do, later generations will have no choices left.

Nada Zaarour is the vice-president of Lebanon’s Green Party

The opinions expressed in this article are the views of the author and not of Executive Magazine

Contribute to the Twitter debate using the hashtag #Leb2013

Lebanon is presented with the most serious challenges it has faced in the past decade. The economy is struggling, the internal security situation deteriorating and the country’s neighbors pose real threats. But amidst everything, there are opportunities — not just in newfound offshore oil and gas but also within the country's ingenious population.

As we head into 2013, what can be done to help the country unite, to overcome its challenges and ultimately to grow? Over the course of this week, eight influential figures will address seven important topics, each suggesting one proposal to help the country move forward. 

Today, two leading writers with diametrically opposed views suggest ways to improve Lebanon’s security. Here Saleh El-Machnouk calls for disarming Hezbollah, while Hicham Safieddine calls for a security pact to prevent the Syria spillover.

Of all the problems we suffer from in Lebanon today, one is not only at the root of most of our other problems, but also stands in the way of our ability to move forward and help resolve the major socio-economic difficulties with which we struggle every day. That problem is Hezbollah’s arsenal of weapons. From allegedly assassinating former premier Rafik al-Hariri, to militarily invading west Beirut, and later enforcing the overthrow of the ‘national unity’ government; these weapons have turned into Lebanon’s cancerous disease, spreading fast and ensuring that no part of our nation remains unharmed.

We cannot survive as a country unless this problem is resolved. And any attempt to resolve other pending issues is hardly fruitful as long as our sovereignty is violated, our security threatened, our stability endangered, and our democratic system in shatters. I am fully aware that a solid majority of our educated elite has grown allergic to repeated, yet unfulfilled, calls by politicians for disarming illegal militias, especially given the endless disappointments caused by the March 14 coalition's retractions and deal-makings over the past several years.

As a young Lebanese citizen, I would have much preferred to speak of improvements such as rethinking our constitution, rewriting our electoral laws, developing our tourism industry, and growing our economy. But what purpose would that accomplish given that our constitution is disregarded, the identity of who wins the elections is rendered insignificant, one bomb could nullify years of effort in our tourist sector, and no Lebanese or foreign entity is willing to seriously consider investing significant sums of money in a country governed by little more than the laws of nature.

See also: Former Labor Minister Charbel Nahas on rethinking the economy

Roudi Baroudi on the country's oil and gas

British Ambassador Tom Fletcher on foreign interference

We now live in a quasi-failed state. Hezbollah’s weapons have given rise to an unbelievable degree of lawlessness. Tribal militias kidnap foreigners and appear live in a press conference on national television to discuss the terms of negotiations, and fundamentalist religious groups are on their way to building military capacities in order to balance those of Hezbollah. If we do not solve this problem through a firm willingness to consolidate and strengthen the state’s authority in 2013, we very likely might find ourselves once again engulfed in civil war, as the breakdown of the state reaches its final stages.

Going forward

Disarming Hezbollah, however, is not all talk. We need a plan, and as the Arab Spring continues to unfold and the murderous Syrian dictator approaches his inevitable downfall, it is time to develop a concrete strategy to put an end to the predicament hindering our national progress. What I suggest here is a four-point plan to move forward on the disarmament of Hezbollah and the restoration of state authority in 2013.

Reform March 14:  There is very little chance that we can make progress on any vital national issues if the political movement which once embodied the dreams of most Lebanese in a sovereign state remains the way it is today. The movement has lost its soul, its independents, its credibility and its ability to inspire and lead. Its leadership should clearly acknowledge that it has been on a disastrous path for five years now, and that it is time for real change. It must also recognize that confronting Hezbollah requires sacrifices and that the approach prioritizing short-term artificial stability and unity has failed miserably.

Stop undermining liberal Shias: The fact that Hezbollah and Amal terrorize their political opponents notwithstanding, the March 14 coalition has since 2005 greatly undermined the power and influence of what was then a sizeable Shia minority of dissidents. It did so because it foolishly believed (and still does) that Speaker of Parliament Nabih Berri is its real ally in eventually defeating Hezbollah. This behavior has not only been immoral, it has transformed the battle into a largely Sunni-Shia confrontation whereas it really is one between state sovereignty and militias. Without the support of an empowered Shia coalition of allies, the battle against Hezbollah will continue to be framed as a sectarian conflict, and is doomed to fail.

Strengthen the Lebanese Army and believe in it: It is important to come to the realization that Hezbollah’s weapons are first and foremost a military problem, and that although political efforts are necessary, it is simplistic to assume that we can solve this problem without a considerable role for the Lebanese Army in an eventual confrontation. The army, however, needs to be supported and equipped in kind, and also needs to have confident and able political leadership guiding its missions.

Win the elections and form a pro-sovereignty government: March 14 can very well win the upcoming elections, and with a solid majority. But in order to do that it must make a clear, irrevocable pledge to its people that this time things are going to be different. Nabih Berri will not be elected as speaker, a March 14 government will be formed, and this government will move forward in dealing with illegitimate militias. And as it wins the elections, it should form a government that will unmistakably delegitimize Hezbollah’s weapons in its ministerial statement, courageously order the army to use force if necessary to disallow the carrying or transport of any weaponry on Lebanese territory, and unambiguously order the armed forces arrest the assassins of former Premier Hariri no matter the costs. While complete disarmament might not be feasible at first, containment is definitely the right step in the right direction.

We had big dreams in 2005. Seven years later, we find ourselves struggling in a country where there is no hope for young men and women to have a better future. 2013 is a defining year. The entire region is changing, and we have reached a crossroads where we need to make difficult decisions about our future. We have an abundance of problems in our country we need to work on — from health care to education and jobs — but if we don’t restore state authority and legitimize the rule of law this coming year, there might not be much of Lebanon left for us to fix.

Saleh El Machnouk is a Lebanese activist and a former lecturer in politics at the Lebanese American University. He is currently pursuing his graduate studies at Harvard University.

The opinions expressed in this article are the views of the author and not of Executive Magazine

Contribute to the Twitter debate using the hashtag #Leb2013 

Lebanon is presented with the most serious challenges it has faced in the past decade. The economy is struggling, the internal security situation is deteriorating and the country’s neighbors pose real threats. In these circumstances the very fact that the country continues to operate can be seen as a success. And amidst everything, there are opportunities — not just in newfound offshore oil and gas but also within the country's ingenious population.

As we head into 2013, what can be done to help the country unite, to overcome its challenges and ultimately to grow? Over the course of this week, eight influential figures will address seven important topics, each suggesting one proposal to help the country move forward. In this article, the World Energy Council's Roudi Baroudi calls for measures to protect the country's offshore oil and gas from corruption.

My one hope for Lebanon in 2013 is that all of its various political leaders and factions take and/or allow the necessary steps for sound and sustainable development of the country’s newly promising energy sector.

Why? Because virtually all of the measures involved a) are just common sense; b) require little or no investment of scarce public resources; and c) happen to be the same changes required to reform, rebuild and genuinely reconcile Lebanon as a whole.

On the overall energy front, the first change would have to be one of mindset. For too long, the sector has been treated by officials, their relatives and their cronies as a cash-cow for themselves rather than as an essential ingredient in building and operating a modern nation-state. From heavy industry to the average family, everyone is affected by the chronic power shortfall. We are more than a decade into the 21^st century: doing homework by candlelight should be the stuff of tales told by grandparents, not the current experiences of schoolchildren also learning to use computers. Imagine if those tasked with formulating and implementing energy policy were concerned at last with basic public goals: namely, how best to deliver affordable, reliable and sustainable energy (electricity, LPG “cooking gas”, gasoline, diesel oil, fuel oil) to all Lebanese.

See also: Former Labor Minister Charbel Nahas on rethinking the economy

British Ambassador Tom Fletcher on foreign interference

Hicham Safieddine on the Syria spillover

Saleh Machnouk on disarming Hezbollah

In turn, this new attitude could quickly convince Lebanese politicians of the need to follow the law by forming a regulatory authority for electricity, and one for the nascent oil and gas industry as well. This would go hand in hand with a government newly determined to ensure transparency, for instance by disseminating all available general information and specific knowledge about the process(es) by which the future of the oil and gas sector is being planned and managed.

The same enlightened leadership would seek out and adopt the best practices at every stage of its oil and gas venture, starting at the beginning. For example, Lebanon should spend its taxpayers’ money wisely by restricting its paid advertising to globally recognized industry publications and highly regarded professional and financial publications like the Economist and the Financial Times,  and using the websites of the World Bank and the European Commission – for free – in order to ensure the broadest possible international awareness of the country’s hydrocarbon potential. The government could then consult the latter two bodies and other reputable institutions to help understand the experiences of other emerging energy powers and avoid making the same costly mistakes.   

Thus animated, not just by the need to closely monitor oil and gas developments, but also by its duty to keep the public informed, the Ministry of Energy and Water would secure timely and professional analysis of the seismic studies immediately following their completion – then, based on these findings, publish the next steps approved by the government in order to pursue development of the fields.

In addition, with the seismic results in hand, the ministry could commission a well-known and qualified international consulting firm to prepare a comprehensive energy master-plan encompassing the entire industry and each of its sub-sectors. The electricity subsector component would be based on a long-term, least-cost expansion of generation and transmission which would take into account feasible grid interconnections with other countries in the region, the role of renewable energy, and integration of the environmental and climate change dimensions to demonstrate Lebanon’s strategy for reducing its carbon footprints in its production and use of energy.

When it comes to the implementation of specific projects, the ministry would act diligently to ensure not only that all necessary environmental impact studies were being carried out, but also that the implementation of mitigating measures was done in accordance with both international best practice and the requisite environmental and social guidelines applicable in Lebanon.

The same spirit of respecting the law and pursuing the national interest also would cause Lebanese politicians, whatever their party loyalties, to avidly support the continued reform of the judiciary, an acceleration of nominations to fill judicial vacancies, and other measures designed to strengthen the rule of law. All of these steps would magnify the impact of the others by helping to ensure that pieces of legislation passed by Lebanon’s Parliament are no longer regarded as idle suggestions to be ignored at will.

All of the foregoing – flowing from the original wish that Lebanon’s main political actors would stop obstructing oil and gas progress – would ensure a dynamic and profitable energy sector capable of alleviating many national problems, especially poverty. Properly managed, oil and gas would supply ample revenues for decades to come, providing the Lebanese state and Lebanese society with the resources they need to finally end the twin evils of systematic inequality and sectarian resentment.

If we really want our grandchildren not to be doing their homework by candlelight, then real change is needed. With simple steps and more enlightened leadership, we can start to make it happen in 2013.

Roudi E. Baroudi is an independent energy and environmental consultant and Secretary General of the World Energy Council – Lebanon Member Committee