Lebanon’s agricultural sector has seen better days. Between 1979 and 1981, the labor force of the agricultural sector accounted for 14% of the total labor force, based on the figures of the United Nations’ Food and Agricultural Organization (FAO). This dwindled to 3% by 2001. In 1961, Lebanon’s Gross National Agricultural Production stood at LL300 million ($900 million, $1= three pounds), according to statistics compiled by the Lebanese Center for Agricultural Research and Studies. Four decades later, this figure has hardly budged, settling in 2002 at LL1.5 trillion ($1 billion).

“Up until, 1918, Lebanon used to provide the French city of Lyon, with half of its silk threads,” said Riad Saade, the center’s director. “In 1936, the French region of Roquefort used to import half of the raw cheese processed in the caves (bearing its name) from Lebanon.”

The decline in Lebanon’s agricultural output took place during the civil war, but it has been exacerbated in peacetime. The loss of agricultural land to the haphazard construction boom of the 1990’s, competition in the key export markets in the Arab World and the government’s focus on investments put the agricultural sector on the back burner. There have been half-hearted attempts, by successive governments to rehabilitate the sector but the only visible evidence of government backing are random subsides dished out at various times to farmers.

In 2001, the farmers raised an outcry and some replanted illicit crops to protest government inaction toward their plight, which left them trampling surplus produce on the streets. The government responded by allocating LL50 billion ($33 million) for an export subsidy program dubbed Export Plus, which gave farmers cash for exporting quality goods to markets around the world.

In 2004, the government and parliament is scrambling again to save the agricultural sector by extending new subsidies to apples and partially re-instating subsidies to sugar beet farmers to appease would-be voters in a decisive election year.

“Unfortunately, successive Lebanese governments have looked at the agriculture sector from a social rather than a socio-economic point of view,” said Raphael Debbane, head of the agricultural committee of the Union of Chambers of Commerce and Industry in Lebanon. “Tobacco subsidies are pure social help whereby the government buys the crops and throws it away because it cannot sell them on the world market on account of their poor quality. Now they have renewed sugar subsidies in a non-professional way and the main reason for that is socio-political.”

Against this government backing to the agriculture sector, the private sector is finding it harder to compete in the local and international markets, where subsidies are given to farmers on a different basis. “If the subsidies are stopped in developing countries, farmers will suffer but they will survive,” said Imad Bsat, owner of B-fresh agricultural company. “If Export Plus ends, nobody will enforce standards and the sector will collapse.”

IDAL helps farmers sell their quality goods, but it does not tell them what type of crops to plant or what kind of crops are wanted by consumers in world markets. “Technically, Export Plus is a success but economically it is a big failure,” said Saade. “The problem is not money. Export Plus is only one ring in a chain. Other rings are needed.”

The other rings of the chain start with orienting farmers on what to plant according to market demands and what types of products to export. The next chain consists of extending technology to farmers to improve their crops and introduce new varieties through government backed research and financial credit. The final chain is marketing, which is what IDAL handles now, said Saade.

“Under Export Plus, farmers exported some 350,000 tons in 2003, which is equivalent to the amount of citrus Lebanon used to export in the 1970’s and 1980’s,” said Bsat. His family used to own Safa Citrus, one of the country’s largest fruit exporters that shut down in the 1990’s. “The government is spending millions of dollars on subsidizing crops when it should be using this money to fund research and help farmers develop new varieties,” said Bsat.

Agricultural engineers say Lebanon’s farmers are unable to adapt to the new agricultural modes, which rely extensively on technology and marketing. “It is a vicious cycle,” said Debbane. “Lebanese farmers have to get know-how and expertise from outside, which means importing technology at a cost. But if you don’t have money, consequently you have no money to invest in new varieties.”
 

The odds are stacked against the farmers’ development. Their production costs are significantly higher than their neighboring countries. They once had a monopoly over the Arab markets, but their rising costs and competition from cheaper produce have forced them to lose their edge in their prime markets. Neighboring Arab countries are swamping the Lebanese market with cheap produce while closing their doors to Lebanese produce, which have been hurt by badly negotiated agricultural agreements. Farmers often cite the agreements with Syria, Jordan and Egypt as disastrous and some are even calling for the suspension of Lebanon’s membership to the Greater Arab Free Trade Agreement, which is due to enter into force in 2005.

“All hell is going to break loose once GAFTA is implemented,” said Bsat, who develops his own varieties of fruits and sells them to supermarkets. “We are already facing stiff competition from their produce now and it will only become harder to sell our produce once the markets open further under GAFTA and the World Trade Organization.”

Waddah Fakhri, head of the Southern Farmers’ Association, wants the government to suspend Lebanon’s membership in GAFTA until farmers are ready to compete with goods from the Arab World. “The government has negotiated trade agreements without consulting farmers, who bear higher production costs than neighboring countries and lack the standards needed to export,” said Waddah.

One sector that is set to suffer from the government’s negotiating blunders is the flower industry. Under Lebanon’s Association Agreement with the European Union, tariffs on flowers were fixed at 30% and are set to go down further once Lebanon’s five-year grace period for lowering tariffs on European imports is over. The whole problem started when the government in 2000 slashed tariffs on flowers from 105% to 30% while it was negotiating with the EU. Following lobbying by Lebanon’s flower growers, the government agreed to raise it again to 70%, but it was too late; the Europeans had agreed on 30% and were sticking to it.

“Our sector suffers from government apathy and inconsistent policies toward the agriculture sector,” said Rania Younes, the owner of several nurseries in Lebanon. “Lebanon has human resources and the know-how to compete. We do not need mass agricultural areas to export. We can plant specialized products from small pieces of land.”

Besides the European Agreement, Lebanon’s flower sector is already suffering from a special agreement with Saudi Arabia, which is exporting flowers to Lebanon at minimal tariffs, she added. With only a few good trade agreements, Lebanese farmers require marketing cash to venture into new markets. Outside Export Plus, there is hardly any cash for marketing. “With a 0.4% budget out of the total government budget there is not much we can do,” said Louis Lahoud, director general at the agricultural ministry. “But we are working on a development plan for the agricultural sector to which the government has allocated LL5 billion ($3.3 million).”

Agriculturists agree that the government should start to control the sector by regulating standards and resolving the pricing anarchy in the domestic market that drove agriculturalists to seek price stability of supermarkets, despite stiff competition. “If we are able to regulate standards and prices in the domestic market, it would be much easier to do the same for our exports,” said Bsat.

Agriculturalists also want the ministry of agriculture to direct farmers to plant crops that could be used by the industrial sector. “A potentially successful road for developing the Lebanese agriculture sector is agro-industry,” said Debbane. “The government can develop Export Plus into a scheme inclusive of the agro-industry and a scheme for renewing orchards to introduce new varieties.”

According to Debbane, donors, who have pooled millions of dollars into agricultural projects that were doomed for failure due to political intervention or government inaction, need to divert the funds to the private sector. “Donors helping Lebanon develop its agriculture sector should pass this money to the private sector because the institutions of the Lebanese government have proved to be inefficient.”

THE ISRAELI EXAMPLE

Farmers and agricultural engineers point to the example of Israel, a country whose agricultural space and climate is similar but less diverse than Lebanon, but whose export potential has been propelled by staunch government backing. Similar to Lebanon, Israel’s agricultural land was being eaten away by a construction boom, declining number of farmers and a strain on its limited water resources, which had to be used to irrigate extensive desert land that Lebanon does not have. That did not stop the Israeli government from forging ahead in the 1990’s with an aggressive marketing campaign and research.

“When Israeli farmers wanted to introduce a new variety of grapes into England, the government spent $1 to $2 million on the marketing campaign,” said agricultural engineer Imad Bsat. Israel in the 1960’s was primarily known for the famous Jaffa oranges, but in the 1990’s its agricultural landscape changed. Instead of planting just citrus products, the Israeli government heavily invested into research, prodding its traditional farmers in the kibbutzes to adopt new agricultural products.

Currently, Israel’s exports around $200 million a year in flowers – a third of its fresh agricultural exports – an amount equivalent to Lebanon’s annual agro-industrial exports. “Each day an El Al plane leaves Tel Aviv and lands in Holland, the world’s flower market, carrying fresh flowers,” said economist Riad Saade. “Flowers are an example of a high-value added industry that can be easily developed in Lebanon.”

Lebanon’s flower exports in 2003 were around $300,000, based on customs figures. According to the Israeli government, it provides nearly 40% of Europe’s off-season fruit and vegetable market, and ranks second only to Holland in European flower sales. Israel’s fresh and processed agricultural exports stood at $1 billion in 2002. Nearly 60% of its exports were fresh produce, mainly headed to Europe, based on the figures of the Israeli ministry of agriculture. Israel does not only export agricultural produce, its also exports around $1 billion in agricultural technology each year.

Abi Habib: `Our loans are convenient, because they are cheap… and long term`

In making agriculture more sustainable in recent years, the availability of financing options has seen some important improvements. The number of loans to the agro sector has mushroomed in the last two years, especially through loans granted under the Kafalat loan guarantee program.

Lebanese farmers and small agricultural enterprises commonly encountered problems in accessing loans at commercial banks, whose focus of business would rarely include agriculture and whose branch networks were concentrated away from rural areas. Agriculturalists on their part were often reluctant to seek bank loans, which carried high interest charges and requirements to post land as collateral, a stipulation which the small land owners and family farmers viewed as running contrary to their traditions.

This placed agriculturalists in a situation where sponsored programs were most appropriate to their needs. One type of such finance vehicle is micro finance, which fundamentally aims at enabling poor people to realize their potential for economic productivity. The tool to achieve this is provision of micro credits with strict repayment discipline, modeled after a development concept popularized over the last two decades through the collateral-free lending activities of the Grameen Bank in Bangladesh. Over 20 foreign and domestic NGOs have involved themselves since the mid 1990s in managing the provision of such loans to Lebanese individuals and small enterprises, in many instances with an emphasis on serving specific communities or geographic regions.

An UNDP country survey from 1997 found that the concept encountered a notable amount of skepticism at that time, but a 2002 paper for a World Bank development debate drew a more promising picture on the potential of micro finance for Lebanon. Presently, accumulated NGO-driven micro lending activities with a ceiling of $5,000 per loan are estimated to stand at a level of around $30 million. As charities, micro finance NGOs are dependent on donor contributions. Except for micro lending initiatives within general lending by commercial banks, the activity is yet to be regulated, making it difficult to analyze the overall scope, distribution and performance. “Some of the NGOs have become more productive, others less,” said economist Joey Ghaleb, who co-authored the 2002 paper.

Experts said that new dynamics would enter this realm and boost the micro finance volume when the central bank implements a planned framework, under which banks will be allowed to utilize a portion of their statutory reserves for advancing funds to micro lending. For the time being, the Kafalat program remains the best non-commercial loan. Kafalat is the loan guarantee corporation whose shareholders are the National Institute for the Guarantee of Deposits and 50 commercial banks. The company was established in 1999 and its portfolio of loan guarantees has seen a tremendous increase from mid 2002, to reach a total amount of $199.2 million at the end of February 2004. With 1,355 loans, agriculture accounted for almost half of all guarantees awarded.

“Our loans are convenient, because they are cheap and more importantly, they are long-term,” said Kafalat chairman, Khater Abi Habib. Loans benefiting from the scheme, under which Kafalat guarantees 75% of principal and interest up to a ceiling of $200,000, can go a long way to help farmers restructure their activities, or enter new activities on land that had been under-exploited.

As it does not stipulate a minimum loan amount, the scheme could also be accessible to clients whose needs are in the range of micro finance. Kafalat as a rule processes loan guarantee requests within three weeks. A characteristic of the program suited to the needs of small businesses, and farmers in particular, is the low reliance on real estate collateral. “With the presence of our guarantees,” Abi Habib said, “it has not become totally easy but much easier.”

While not designed to finance major agro-industrial projects, the scheme allows the infusion of larger amounts into agro-industry through the nation’s industrial lending program. “I saw a number of agro-industrial concerns financed by central bank-subsidized loans creating sure markets for agriculturalists as suppliers of raw materials,” said Abi Habib, “and those agriculturalists are in turn being financed by banks on basis of the strength of the purchase contracts given to them by agro-industrialists, plus the strength of market developments and guarantees given by Kafalat.”

As medium-term facilities, the low-interest seven-year loans with a one-year grace period are suited to the needs of most agriculturalists. One sub sector of agriculture to which the parameters of Kafalat loan guarantees are less well suited, however, is tree farming. To start operation of an orchard, a farmer needs finance facilities that are repayable over 12 to 15 years, with a three-year grace period. For this, Kafalat guarantees are inadequate and a source of long-term funding would be needed, with possible sponsors including Lebanon’s usual partners in lending and aid programs, such as the World Bank, EU and their affiliated finance institutions.

The loan guarantee company is engaged in continuous efforts to inform its client base of existing or potential small and medium entrepreneurs. “The best marketing is for us to be in the midst of our potential users,” said Abi Habib, “the north is our weakest market, and that’s why the largest portion of our visits and activities is now to the north.”

Lebanon’s Investment Development Authority, IDAL, figures twofold in the task of promoting the national agriculture and agro-industry sectors. Under the 2001 investment law 360, the agency offers incentives to investments into strategic sectors of the economy, including agriculture and agro-industry. For the past three years, the IDAL mandate also extended to supporting agricultural exports through the Export Plus program offering farmers transportation subsidies and quality certification for produce. In February 2004, IDAL and the nation’s agro-industrialists signed a collaboration for an Agro Market Access Program (Agromap). EXECUTIVE talked to IDAL chairman and managing director, Samih Barbir, about the agency’s achievements and plans in relation to the agro sector.

Where does IDAL set its priorities in supporting agriculture and agro-industry?

In Lebanon, we don’t have large volumes in agricultural production. Therefore, our main priority is quality. The successful experience of Export Plus of having two international firms implementing quality control has proven to be a very important factor in marketing Lebanese agricultural products abroad.

When you discuss Export Plus as a success story, where are the highlights, and what are the areas still in need for development?

The level of success is simply the fact that we witnessed an increase in our exports. In the first year, it was a big increase of 15%, in the second year, 5%, and last year, it was stabilizing. But one has to look at it in a different way. Before the launch of Export Plus, we were on a downward slope. Exports were dropping and the whole sector was suffering a lot, due to many problems. Maintaining a stable level of approximately 360,000 tons in exports per year is a success in itself. We experienced some additional difficulties, such as some bad weather hitting Lebanon over the last two years, the devaluation of the currency in Turkey and the war in Iraq, all of which affected our export markets.

In your statistics, 99% of agricultural exports went to GCC countries, plus Syria and Jordan. What can IDAL do to improve agro exports across other markets?

The GCC are the natural market. The Iraqi market is a new one that we are trying to enter right now. But our main objective is to enter European markets. We are doing a lot of contact work with all the embassies here, especially Eastern European ones. As a first target, we are trying to enter those countries that have the least obstacles.

Your 2003 report states that about 5% of agricultural products destined for exports to Arab countries were rejected in quality inspections. Would the same quality requirements apply to produce destined for Europe?

Exports to Europe would have to meet higher and different quality requirements. They have some very strict controls on pesticide residues and other issues that are not required by Arab countries. That is why we have to inform those farmers prior to starting to control their products.

On the other side of the coin, IDAL has the mission to draw in investments. How is this progressing as far as attracting agricultural investors?

We offer the same incentives to projects in all the sectors listed in the [Investment Development] law, as are tourism, ICT, agro-industry, industry in general and agriculture. The only difference is that agricultural projects have the lowest minimum investment requirements to qualify for incentives.

How have agricultural and agro-industry projects fared in terms of attracting investors?

We have two agro-industry projects that are being processed under the one-stop-shop service. The law is still relatively new and the incentives are new. It takes some time to let people know about it. We are planning to do a campaign by the middle of this year, to promote those incentives. But definitely, compared to tourism, it is still very shy.

Can you name an amount for the value of one of those two projects, to give an idea of the magnitude?

The project that has progressed further is for $4.3 million. Don’t expect to get big figures in this industry.

How much funding for agricultural export promotion do you have at your disposal?

The Export Plus program was approved for LL100 billion spread over the four years, 2001 to 2004.

How much have you dispersed to date?

A bit less than LL30 billion each year. We can handle the program until the end of this year. We might need some more [funding] but there is no problem in that. Theoretically, it should be covered.

Under the new Agromap project, you are sponsoring participation of Lebanese exhibitors in trade shows in Beirut, Paris, and New York. How does this interlace with the promotion of agricultural exports under Export Plus, where you described the strongest markets and prospects as being in the Gulf and Eastern Europe?

With Agromap, we are targeting a different sector, agro-industry, and are promoting Lebanese agro-industry products. We are doing this as a pilot project in 2004 and I wanted to reach the Arab, European and North American markets, to see what the impact would be. We will evaluate each event right afterwards and depending on those three events, we could consider going into another round with a bigger budget in 2005.

Did you allocate equally to each fair, Horeca in Beirut, the Fancy Food Show in New York, and Sial in Paris?

Between the US and France, there will be equal space. Lebanon will be bigger. Here, much more people will come because they do not have the transportation issue. Horeca also accounts for biggest amount in the budget.

How was the response from the industry?

The first results are very good. For Horeca, we have about 35 industrialists and for the Fancy Food Show about 15. We are over-subscribed but I wouldn’t call that a problem. We will have the luxury to choose the best products to represent Lebanon abroad.

What will you provide to the companies that qualify for participation?

We will have a Lebanese pavilion, and we will cover 100% of the rent and the stand decorations. Exhibitors will have to cover their transportation and other costs.
 

Gada Sardouk is trotting out the government line. “Beirut’s downtown is the success story of the entire region. People are visiting in huge numbers,” said the director general of the tourism ministry. “Yes, it is sometimes crowded but the area has no problems. If there were anything to harm the tourist, it would be empty.”

Warped logic aside, if the growth of the area’s restaurants and cafés is a measure of its vitality (numbers rose from around 40 in late 2001 to over 70 in the summer 2002, 99 in autumn of 2003, and more than 110 this spring), the same activity offers equally negative indicators, such as the district’s high rate of restaurant closures and re-openings, affecting one in every five establishments over the last two years and with some properties on Maarad street housing more than three outlets during the same period. But the real problem is highlighted by the teams of municipal officers that swarmed through the area in February and March, instructing tenants to remove outdoor plant decorations, abide by sidewalk seating limits and meet hygiene standards. Those, though not all who were in breach were fined. A token gesture, say many; the problem has not gone away.

The two largest stakeholders in the area, the municipality of Beirut and Solidere, the company tasked with its redevelopment, say they are engaged in a major clean-up campaign to improve the area’s image by purging the downtown hospitality sector from various style aberrations and regulatory infractions. Both have been compelled to act. City hall does want to see the downtown become ‘sin city’ and Solidere does not want its shareholders repulsed by a deteriorating ambience. “Merchants and operators approached us to discuss how to organize the management of the area,” explained Georges Nour, property administration division manager at Solidere. “Nobody was respecting the rules.”

“Presently, the Beirut Central District (BCD) works in a very narrow and ill-directed way,” said one of Lebanon’s highest ranking public figures who refused to be identified. “It is an attraction for the bad side of tourism,“ he fumed. “Ours is a country that is 7,000 years old. We should have much more important poles of attraction for tourists. The downtown is over saturated with nightclubs and pubs that are so expensive that only a few rich people can enjoy it. This is not the vision of a downtown where people meet to exchange views on topics of culture, politics, or religion. When you sit in one of these cafes today, you hear anything but.”

Prime hospitality stakeholders in the area also raised grave concerns. “Investments are risky if regulations are not enforced. Can the authorities not see what is going on?” asked an angry Michel Fernein, owner of La Posta.

“For the time being, the situation is not as we expected,” said Dory Daccache, head of the Crepaway restaurant group and who holds stakes in four budget and mid-level eateries in the district. “That the area has been going down is not really a sufficient term to describe it.” According to Ferneine, both the luxury and mid-market restaurant niches have seen revenue shrink in the last year. “The average spend per ticket in 2003 was lower than in 2002, especially in the evenings,” he said. “Patrons who would order an upscale dinner and an important bottle of wine now stay away. They are no doubt put off by the congestion, noise, and harassment.”

The downtown appears to have a problem of clashing restaurant cultures. Restaurateurs are at odds over loud music and ‘un-neighborly’ practices and fight over precious outdoor seating areas. The situation has seen three distinct sub-groups emerge: those that actively disregard rules and live by fly-by-night mentality; those that want to see rules enforced and espouse a long-term strategy of doing business; and a buffer group, probably the largest of the three, comprising entrepreneurs that fundamentally accept the need for regulations and positive conduct, but do not actively seek to improve things and instead go with the flow. Plaintiffs from the second group insist that it is neither a matter of price competition nor a complaint against the riff raff. It is, they claim, all about Lebanon’s image. “Any downturn in revenue is our problem,” said Fernein, “but the reputation of the country is at stake here. The downtown is the most important project in Lebanon. How can something this important have so many things that obviously don’t work?”

Surprisingly, many of these complaints have been echoed by operators whose establishments in the past year have been less than scrupulous in maintaining their own standards in terms of rampant outdoor seating, lack of customer bathrooms and harassment of pedestrians.

“If it is not regulated, the city center is going to be a jungle,” said the owner of an eatery serving what he called “affordable food in big portions,” out of a kitchen installed in what was clearly designated to be a retail store. On condition of anonymity, the entrepreneur admitted that he had hired a hostess for the specific purpose of approaching potential customers. “We are a new place,” he said. “People wouldn’t notice us if we didn’t send the hostesses to explain our menu.” When asked about restroom facilities for the 40 or so seats in front of his establishment, he said a new portable toilet would be installed that night. He had a simple explanation for the area’s hospitality problems. “They didn’t expect the boom,” he said. “More restaurants than they ever expected opened in this area.” There is some truth to this. According to Nour, the success of Maarad began as an “urban management accident.” The Solidere master plan had earmarked the street for vehicular traffic and not as pedestrian zone. The plan had expected retail businesses to populate the street, and most buildings were not equipped for restaurant use, creating challenges in the adaptation of facilities, setting up generators, storing supplies (including cooking gas), and the collection of waste, that only a few investors rose to.

“You cannot believe how dirty it is behind the doors of some kitchens and service areas,” lamented one manager. “Some neighbors here have had an abominable lack of hygiene.” This situation is improving now, he added, since a system for collection of food waste and used cooking oil begun in February, as part of the initiative to better the area.

Many stakeholders agreed that implementation of hygiene standards should be more strongly enforced. “Lebanese regulations on restaurant hygiene are excellent,” said Daccache, “but some restaurants do not apply the regulations, and enforcement is weak.” The inspectors from the health department at the Beirut municipality, the supervisory authority for restaurant cleanliness, are reportedly meticulous in checking that employees working in restaurant kitchens wear hair covers and gloves and have clean fingernails. As a result of the unsanitary practices of some operators prior to the implementation of a new garbage collection scheme earlier this year, pest problems reportedly got so alarming that competitors in the same building had to hermetically seal off doors in order to ward off a despicable daily invasion of cockroaches from the garbage next door. Yet some restaurant owners wonder if all establishments are inspected with equal vigor. “The health inspectors are very tough on me,” said one manager who lambasted his neighbors for having no toilets and dirty kitchens. “If they are also being checked, how come they are still in business?”

Central to the whole issue is the legal status of restaurants, cafes, snack bars and nightclubs. Stakeholders and legal experts estimate that only a minuscule portion of downtown establishments operate with a full license, a legacy of Lebanon’s restaurant law, which was adopted by parliament in 1950 and has remained virtually unchanged since 1970. “In general, obtaining a restaurant permit from the ministry of tourism is extremely difficult,” said Paul Awad, a lawyer specialized in issues relating to the hospitality industry. “Not more than 5% to 7% of restaurants hold a permit.”

Getting a permit is a two-step process. Firstly, operators have to prove their basic compliance with regulations on kitchen facilities, bathrooms and exits, etc. If these are met, the restaurant, cafe or pub can launch its business but it still needs to complete the second step of the licensing in which the applicant must prove the existence of one parking space per 4m2 of restaurant floor space, on the same grounds as the restaurant location itself. Alternatively, the establishment can pay the municipality between $5,000 and $7,000 per non-realized parking space. “Nobody has these spaces, and nobody is willing to pay these amounts,” Awad said. “Therefore nobody gets a permit.”

Realistically, restaurants that have completed the first stage of licensing requirements face little trouble and can be reasonably certain that they will not be shut down. However, the second license is the basis for the classification of restaurants, the lawyer said, and one important consequence of the lack of full licenses is that eateries and pubs are not classified by the ministry, which in turn diminishes the ministry’s ability to monitor their compliance with price levels and service charges. On a day-to-day basis it works. The ministry does what it feels it has to, to maintain standards. “To be realistic, Lebanon is a tourism country. We deal with the private sector in form of a partnership,” said Sardouk. “We are very strict in responding to complaints but very flexible in communicating with the private sector. We are not a police state.” Sardouk added that in the whole of 2003, the ministry of tourism had received 10 serious complaints from tourists and acted upon them, only one of which involved a downtown restaurant. Hospitality establishments in the area display stickers with tourist police telephone numbers, should they have a complaint. When Executive tried to contact the tourist police, it was connected to an Ogero recording that said the number was “not yet in service.”

However, weaknesses in the legal framework clearly contribute to the current malaise. Operators who disregard rules tend to use what they see as absence of a clear legal environment as an all-purpose excuse for ignoring standards and regulations, but for those who wish to instigate improvements or challenge infringements, the legal ambiguity can be a major impediment because an “unlicensed” restaurateur with a complaint does not enjoy full legal status and is immediately at risk of becoming a target. In their plan for improving downtown, the municipality intends to enforce compliance with all standards before this summer. This will involve making operators abide by the areas of public space they rent from the municipality for outdoor seating and respect those regulations that insist that emergency pathways be kept clear and enforce all other municipal codes. For its part, Solidere has retained a consultant to style the area with a range of official materials, colors and designs for awnings, tables and chairs. “We are proposing to the municipality all ideas that we want to implement,” said Nour. “The organization of the public open space is the mandate of the public sector administration. We are offering only value-added. Urban management needs dialogue between the city and the people.” Reassuringly, in this context at least, both the municipality and Solidere claim that relations between them have never been better.

Restaurant owners who want to see standards improve say they are prepared to contribute to enticing back a better class of customer. In the long run, they also expect that the overall growth of the city center towards the seafront and the hotel district will alleviate some of the problems the area has experienced in the last two years. Finally, on the legal front, a revised restaurant licensing law with more practical regulations is under review in parliamentary committees, with hopes that it will be pushed through soon. But in a country where the law is frequently overlooked when it becomes a hindrance, it remains to be seen whether this will be enough.

Overcrowded mess

With seating boundaries constantly in violation, Maarad is becoming an accident waiting to happen

The restaurants and cafés on Maarad and Al Omari Streets are demarcated by round, metal studs embedded into the pavement, which represent the limit that a restaurant can place an umbrella, awning or gas heater. If they exceed the boundary, restaurant owners are, in theory, in violation of municipal seating regulations, designed to ensure there is enough space for pedestrians and emergency vehicles to pass. Most of the restaurants regularly violate these laws and Maarad Street, with its gas heaters and plastic awnings, is an accident waiting to happen.

An example of this blatant violation could be found at Al Sa’a, located across from the clock tower. On the last Sunday of March, the café increased its sales area from its usual 100 to some 168 chairs. The restaurant not only set up extra rows of tables in front of an empty storefront adjacent to their location, it also added two tables per row to an area that passersby should freely walk through according to the law.

The manager of Petit Café, one of the places on Maarad with the highest number of outdoor seats, admitted to Executive that in the high season (when the lion’s share comes from outdoor guests), he makes an average of “including cover charge, $25 per customer.” This is too much to resist for landlords who say they are struggling with the BCD’s exorbitant rents. For Layali al Balad, for instance, the owners pay a reported $260,000 a year to sublet the tiny premises. By bending the rules during one day in the busy summer season, 24 “extra” outdoor chairs can add another $1,440 to the day’s takings; that’s in excess of $44,000 each month. When some landlords are paying up to four times the market rate, this extra revenue can make all the difference.

On March 30, Executive, posing as a potential customer, spoke to restaurant owners and managers in the area to see how many outdoor diners they could accommodate at full capacity. Al Sa’a said it could accommodate a staggering 500 diners. La Cita offered to seat 120 diners, Kiub’z 150, while Petit Café and Layali Al Balad said they could seat 450 between them. Even with the most generous calculations these seating arrangements would easily put them in violation of municipal laws. Only Hani Osman, manager of TGI Friday’s, said that if he wished to exceed his legal quota, he would have to check with the municipality.

That the rules are being broken at will is obvious, but what is inexplicable is that the municipality is unable to exert its influence. In the property management offices of Solidere, a large map, dated December 2002, is pinned on the wall. It delineates in perfect detail areas where hospitality enterprises are allowed to set up tables and where they are not. The map is equally well known in the halls of the Beirut municipality, where officials admit that the regulations are not enforceable and that patience is required in the almost daily fights with some BCD tenants. According to the municipality, rent per square meter of its territory is 3% of the annual rent per square meter of a restaurant’s indoor area. The municipality would like to increase this to 15% or 20%, but for the time being income from the downtown business, either in rent (of public space) or fines is not a money-spinner. (Some outlets have been “fined” – in some cases as much as $30,000. This constituted rental dues and fines for operating outdoor seating for two years without a license.) It may simply be that many of the owners are politically backed and, therefore, immune to the rules and regulations that mere mortals have to abide by. The Bendakji brothers –who own Kiub’z, Petit Café and Layali al Balad as well as Al Sa’a, Grand Café, and VIP (the latter two are in the area of Abdel Malak Street) – are allegedly stoutly backed by top political individuals and appear to flout regulations with impunity. In the short term, a new walkway over the downtown ruins could offer visitors and restaurateurs on that side of Maarad a solution. The walkway will be inaugurated in the summer, but the municipal board has not yet reached a decision on allowing outdoor tables. Permanent barriers are also planned but fears remain that there will always be those whose connections will encourage them to ignore the law.

A CIA job advertisement currently posted on the agency’s web site is offering up to $55,000 a year for “qualified and motivated Language Instructors of Arabic, Chinese, Dari/Pashto,” to work in the Washington, DC metropolitan area.

And for “qualified individuals who are able to read and translate Arabic, Dari and/or Pashto into English to serve the CIA as Middle Eastern Language Specialists in the Washington, DC metropolitan area, with limited opportunities in other areas,” the pay is even more interesting; up to $70,000 a year. For those Lebanese who fancy quadrupling their salary, there are basic qualification criteria: for a start you must be a US citizen. Furthermore, the vetting process is strict. Candidates must pass background security checks, a polygraph (lie detector) test, and so on. Even though in 2002, the FBI, reportedly had only 25 Arabic speakers, of the 73,000 resumes received by the NSA since 9/11, only a few have been selected.

Yes indeed. Despite the anti-Arab, anti-Muslim bias that may have surfaced in the United States after 9/11, demand for Arabic speakers in various levels of government – from the US military, to the FBI and the CIA – are at an all-time high (even the British MI5 have put out the call for Arabists). It would seem that the Bush administration is heeding the advice of Chairman Mao Zedung, who wrote in his little Red Book that “the first step towards defeating your enemy is to get to know him.”

But it wasn’t always thus. When George W Bush first came to the White House in January 2000, he tried, by and large, to ignore the Arabs, Islam, the Middle East and all its confusing troubles. In fact, his critics would accuse him of turning away from most anything that was related to international affairs. The new president wanted to diverge from his predecessor’s policies and disengage the United States from foreign interference. His aim was to focus on domestic policies, first and foremost. Ironically, today it’s the domestic economic situation in the United States that is Bush’s weakest link and the one that could lose him the 2004 election.

But as we know, the September 11 attacks forever altered the way Bush, America and Americans look at foreign policy, and particularly, at the Middle East. Since then, hardly a day has gone by without some Middle East-related news item hitting the pages of the American press or airing on national television. For the most part these reports are negative, portraying the majority of Muslims and Arabs as tainted by terrorism or hating America. But every so often, there will be one item that sheds a more positive light on the issue.

As the presidential electoral storm begins to gather momentum in Washington and the rest of the country, the Muslim/Arab vote – estimated to hover around the three million mark – is beginning to emerge as something both Democrats and Republicans would like to court. Particularly in light of how close these next election results are predicted to be. Understandably, the Muslim/Arab community is starting to realize its full potential as an electoral block and one that should be reckoned with.

Some US Muslims groups have undertaken a campaign to try and register up to 85% of the estimated three million potential Muslim voters in an effort to get them to vote in the upcoming November elections. And in the process, of course, let the political landscape in America become aware of the influence this group may hold. There are an estimated seven million Muslims in the US, of which some are expected to play an increasingly effective role in electoral politics.

Some Muslim organizations put the number of currently registered Muslim voters in the US at 1.8 million. There are predictions that those numbers will significantly increase as a new generation of young Muslim Americans comes of voting age.

But the Muslims in the US are far from voting as a unified block; they are divided between Democrats and Republicans. Traditionally, being more conservative in nature, Muslims tend to vote more Republican. “Many Muslims also voted for the Republican Party because they felt more comfortable with the party’s family-oriented, conservative values and with their stand on issues like gay marriages. Like the Republicans, many Muslims have a very conservative approach to these issues,” said Naushaba Ali, a Virginia resident and female activist who voted against Bush in the 2000 elections.

Afraid of losing its solid Jewish base, the Democratic Party has avoided flirting with the Muslim-Arab constituency. The Democrats’ historic alliance with Israel and the tendency of American Jews to vote Democrat has, in the past, made the Republican Party more appealing to Arab Americans. But that was until September 11 and the drastic changes that overtook the course of events and Arab-American relations.

The clampdown by John Ashcroft, the Attorney General, on Arab and Muslim groups that followed the September terrorist attacks; the arrests and detention of hundreds of Arabs and Muslims in the US, often without warrant or viable reason; additional harsh restrictions imposed at American points of entry, and the war in Iraq, has greatly stressed relations between Bush’s Republicans and the Arab-American community.

Many Arabs and Muslims in the US feel they have become unfairly targeted and unjustly discriminated against. They like to point out that the extremist fringe in Islam represents a very small percentage of the world’s more than 1.4 billion Muslims.

That feeling is not reserved exclusively to Arabs living in the US and is even echoed by a number of Americans. “US policy [in the Middle East] is viewed as anti-Muslim, a crusade against the ‘axis of evil’ and unfair, due to practices that favor Israel over the Arabs.” Those words come from a February 2003 study by the Institute for National Security Studies of the US Air Force Academy in Colorado titled, “View from the East: Arab Perception of United States Presence and Policy.”

The study states, in part, that Arab populations have become alienated from their governments and therefore tend to turn to Islam as their only solution. Usually, the study finds, that it is radical Islam that these populations usually turn to. This explains, in part, Bush’s incentive to impose rapid change on the Middle East. But the changes, needed as they may well be, can only come with the participation of the people involved. Many Arab leaders are beginning to realize, and admit, that the area is indeed in dire need of radical change. But as is often repeated by the Arab world’s leadership and outside observers familiar with the area, these changes must come in concordance with the people of the region. This change cannot be unilaterally imposed, as the Bush administration seems to believe it can.

In a March 12, Washington Post column, David Ignatius quoted Sheikh Mohammed Hussein Fadlallah, Hizbullah’s spiritual leader as admitting that Arab leaders were delaying their move towards democracy, largely using the “excuse” that Israel stands in their way. In other words, as long as the standing Palestinian-Israeli conflict would not be resolved, neither would the issue of Arab lack of democracy.

Every Arab official one talks to will reiterate that fact; solve the underlying problem troubling the Middle East first. Otherwise, addressing other Middle East issues ahead of the Palestinian question, such as introducing democracy in the area, becomes similar to trying to scratch your left ear with your right hand by placing it over your head. Why make life more difficult?

Al-Qaeda’s pet grievance – whether accurate or not – is the Palestinian issue. The same holds true in other non-Arab Islamic countries. Yet, the issue President Bush had promised to address head-on following the Iraq war (via the Middle East Road Map) remains on the back burners of US foreign policy makers.

Realistically however, while solving the Palestinian issue is by no means going to be equivalent to waving a magic wand over the Middle East and making all its problems disappear overnight, it will, nevertheless, accomplish two very important things. First, it will remove the primary reason of discontent and source of animosity currently existing between the Arab-Islamic street and the West, (primarily the US). Second, it will remove the “excuse” mentioned by Sheikh Fadlallah from the Arab/Islamic leaders to keep stepping on the brakes of the region’s natural march towards greater democracy.

In June, Bush will present his New Middle East Initiative, when he convenes with other world leaders in Europe. The details of the plan are still unknown, but already the proposal has become the target of harsh criticism from people and leaders in the concerned area, the reason being that they were not consulted. Maybe what the president needs to better understand the Middle East is more than a handful of linguistic experts?

Claude Salhani is a foreign editor and political analyst at United Press International in Washington, DC.