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LeadersOpinion

Lebanese design deserves attention

by Executive Staff April 3, 2019
written by Executive Staff

Design, as the fruit of creativity that enables its user to co-define and express their identity, while optimally matching form and function of a product or process, has been around for as long humans have had the capacity to imagine.

Lebanon is a great example for the presence of design throughout the history of people living on the culturally fertile shores of the Eastern Mediterranean. When compared with the past roles and value-added functions of design—for example 100 years ago when the legendary Bauhaus was established as laboratory of ideas, architecture, and applied arts in 1919’s Germany—design capabilities today appear to represent an even greater asset in our times of societies’ digital transformation, economic globalization, and wide-ranging individual pursuits of new identities.

While numerous innovative design approaches have been fostered through the private initiative of design professionals, teachers, and thinkers in Lebanon over the last few years (as Executive has reported), the design sector in this country still remains sadly underappreciated, incompletely mapped, quite poorly understood, and even more poorly supported by important political and financial institutions. As our investigation of Lebanese design conditions in this issue shows, the ecosystem for design is growing, but marked mainly by individual efforts and scattered individual success stories.

The value of the ecosystem and support structures for Lebanese design industries have not been comprehensively and systematically assessed for their contribution to the struggling industry sector or the national economy as whole. There are many hints that creative and cultural industries—first-line beneficiaries of designer inputs—can thrive, but very little information is available on how design investments translate into economic gains in long-standing or newly reimagined crafts workshops.

Finally, design appears to be an underexplored and largely untapped mental resource when taken in the sense of improving not only the beauty and functionality of products, but in the sense of the importance of citizen-centric design for reforming heavily outdated, non-transparent, and wasteful processes in the interactions between citizens and their public servants.

Thus, at this time Executive draws attention to the need for greater appreciation of design as part of the revitalizations, the structural and administrative reforms, and the economic and financial investments that are the acknowledged priorities of Lebanon for 2019 and the coming years. Governmental support of design is needed and, under current pressures on the government, there should be an awareness and wide organizational buy-in into the importance of design as part of implementing e-government and digital transition in the public sector.

Many design stakeholders confessed to Executive that they would be delighted if the state would commit tangible support to design—in forms of sponsorship of export-enhancing design exhibitions abroad, easing of export procedures for design products, or fiscal and structural support for young ventures in creative and cultural industry with high-value added—but also say that, realistically, they prefer to not expect governmental support that will cost our cash-strapped state.

Design stakeholders believe that private sector support, on the other hand, could be envisioned to incorporate very impactful financial angles. This could be as fundamental as using design in manufacturing processes from the first moment and showing financial appreciation toward design contributions to products manufactured in the private sector by adequately remunerating their designers. However, it could be even more powerful if industrialists and private investors were to dedicate funds for investing into design clusters and enterprises, or engage with Lebanese designers in efforts of better defining and organizing the design sector as professional syndicate or association. Academic institutions with stakes in design development could broaden their course offerings to teach more of the history of Arab and Lebanese design (instead of prioritizing other aspects of this history), and they also would do well to improve efforts to encourage female design in what has been presented wrongly as a male-dominated realm.

Presently, many Lebanese designers, design workshops, consultancies, and agencies have their days fully filled by the struggle for financial survival. They have precious little time for organizing and advancing the design culture that can add a lot of economic and social value to the nation. If public and private stakeholders with great potential to benefit from design made in Lebanon consolidate their will to think design when taking Lebanon through its impending reforms, economic invigorations, and new expressions of its wealth of talents and identities, new economic and social potentials can be unlocked at low cost when compared to likely benefits. Executive thus sees great new value potentials in focusing on design from measuring the economic value of design inputs over further empowerment of the design ecosystem to, in the long run, viable financial inputs in form of private investments and public incentives.

April 3, 2019 0 comments
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EditorialOpinion

A trap of their own making

by Yasser Akkaoui April 3, 2019
written by Yasser Akkaoui

It has been a year since Lebanon agreed on a path out of its crises, promising to undertake serious reform efforts in exchange for the $11 billion pledged by the international community at CEDRE. The nine months after CEDRE were primarily spent on political bargaining and government formation, all built on the hope that these funds were the way out of our current malaise.

These past two months our new government has become obsessed with securing the CEDRE funding, revealing how addicted our political elite are to handouts. Yet there has been no indication that the government is even capable of enacting the reforms needed to unlock CEDRE funding. Their hunger to divvy up the promised funds has blinded them to the reality of what reform really means. They have fallen into a trap of their own making.

In order to access the $11 billion, the government will have to dismantle a web of informal, unregulated, and illegal privileges that have been distributed from on high in order to extract the wealth of the Lebanese for the benefit of the few, and, in its place, create a national system that works in the public interest. And all this is expected to take place in a matter of months—good luck!

Alternatively, every industry in this country has a wealth of human resources and energy. If the government was able to engage on an industry level it could unlock a productive potential far greater than the promised $11 billion. The private sector’s energy, coupled with its knowledge and creativity, is a much smarter and adaptive resource for the government.

The Lebanese have a natural talent for design, one that has been honed over the years through the innovation and adaptation that has been necessary to survive. We expect our government to allow the private sector to step up its role and take the lead. It needs to migrate from an extractive model to an inclusive one—one were every stakeholder is engaged in order to improve productivity, efficiency, and value creation in the country.

It is only when our government becomes more inclusive, and puts creative thinkers at the heart of its efforts, that Lebanon will start solving its own problems and unleashing its true potential.

April 3, 2019 0 comments
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Brand Voice

E-banking lands in Mar Mikhael

by Nabila Rahhal March 21, 2019
written by Nabila Rahhal

A walk in Mar Mikhael reveals that it has become the hub of hospitality for millennials in Lebanon; during the day, its appealing restaurants and quick snacks attract those who work in the area, while in the evening, it’s a destination for gatherings with friends over drinks or bistro dinners.

As such, Banque Libano-Française (BLF) was savvy enough to identify the street’s attraction to that young demographic. “We chose Mar Mikhael to launch our new e-branch concept, notably because it is vibrant and attracts the public, mainly millennials, into its restaurants and pubs,” explains Marwan Ramadan, assistant general manager and head of Branch Network Division at BLF, adding that more digital solutions will be available soon at BLF e-branch.

Millennials, who are often referred to as the “tech generation,” are typically more comfortable behind the screen rather than communicating with tellers or their bank managers for their banking needs. The new e-branch concept offers them, and all other BLF clients visiting the area, an enhanced digital banking experience, which includes several key and common banking needs.

For example, not only will customers be able to withdraw cash, they will also be able to deposit cash and checks, settle their credit card payments, pay for a wedding gift, and transfer money between accounts through two ATMs, making for a speedier and more efficient banking experience. BLF also eliminates the need to visit the physical bank by allowing customers to access their account, apply for loans, settle their tuition fees, track their outward transfers, in addition to the above mentioned ATM features, through the e-branch, BLF e-banking service, and the mobile app, My BLF, in a simple and secure way. This is yet another tool that will surely appeal to millennials, but also to anyone who is simply doesn’t have enough time to visit a traditional branch.

The e-banking concept is the latest tech platform through which BLF demonstrates its innovative mindset and its ability to stay up-to-date and allow its clients to benefit from interconnected platforms with the peace of mind of knowing that their accounts are safe.  

Concerning the bank’s digital strategy and roadmap, Ronald Zirka, head of marketing and retail at BLF explains, “What differentiates Banque Libano-Française and gives a competitive edge to its digitization efforts is its ability to continuously enhance its digital platforms. Lately, the bank launched a new solution that allows its customers to track their transfers on the e-banking and the mobile app, My BLF, by checking their transfer step-by-step status, including the execution dates, and all fees and commissions charged by every correspondent in the chain.”

“Understanding our clients’ expectations is the main driver behind every change. BLF strives to anticipate those expectations to enhance the customer experience on all its physical and digital channels,” he adds.

What started in Mar Mikhael will surely spread to many areas across Lebanon, and as such, more BLF clients will benefit from technology to have easy, efficient and safe access to their bank.

March 21, 2019 0 comments
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Last wordOpinion

Factors keeping Lebanese youth unemployed

by Rena Temsah March 14, 2019
written by Rena Temsah

On the one side are Lebanese youths eager to work, on the other are local employers looking for staff. So why are businesses—especially those based outside of Beirut—not recruiting more local youth? This question was the driving force behind Mercy Corps’ Youth-led Market Assessment (YLMA) in 2018.

The YLMA explored the reasons why youth were not penetrating the labor market in three areas of the country: Saida, Tripoli, and Barja (Mount Lebanon). It was conducted as part of a three-year Canadian-funded program aimed at protecting youths’ well-being and providing better opportunities, particularly in those three areas. The study interviewed 800 employers and involved 75 local youth volunteers as researchers, as well as Remark, a Beirut-based research consultancy that is studying livelihood opportunities for Lebanese, Syrian, and Palestinian youth and their families.

Three main findings were gleaned from the research. Firstly, the largest barrier to Lebanese youth employment found was a lack of communication skills. Almost 60 percent of the surveyed employers, who worked in industries including retail, manufacturing, pharmaceuticals, services, and F&B, cited poor communication skills as a factor preventing those aged 16-25 from being employed (compared with just 8 percent raising the inability to work under pressure, 7 percent poor teamwork skills, and 6 percent poor time management). When asked to elaborate, participants highlighted a perceived inability of youths to talk to customers, to accept criticism, and to express themselves adequately.

To improve their communication skills, the report recommends that Lebanese youth attend life skills courses when possible; Mercy Corps currently offers such classes at its three branches of Bussma, local youth community centers (in Saida, Tripoli, and Barja). The report also suggests that technical, vocational, and educational training institutes across Lebanon include soft skills training in their curriculums.

Secondly, the study found that unemployed youth in Lebanon (Lebanese, Syrian, and Palestinian) were pursuing careers that did not match market needs. Work trends in Lebanon are geared toward industrial jobs in, for example, agro-food and STEM, but youths surveyed planned to pursue careers in photography, design, acting, dancing, and sport. Trade careers in demand, such as electricians and mechanics, are shunned in favor of accountancy or marketing studies. Social standards can play a role here; a director at a vocational training institute cited a huge demand for waste management and sanitation specialists, but said that Lebanese students refuse to go into this field as it is deemed shameful.

To break this disconnect between the careers in demand and the careers studied, the report recommends that technical, vocational, and educational training institutes and universities provide more information to prospective students about in-demand jobs—thought by the interviewed employers to be in retail, creative industries (such as jewelry design and our craftsmanship), agriculture/ago-food, and tourism.

Thirdly, the study debunks the commonly held assumption that the Syrian crisis has increased the unemployment rate in Lebanon. The study focused on recruitment trends for Palestinian and Syrian youth and found that they often take jobs requiring intense physical labor in the agriculture, environment, and construction sectors—and are not competing with locals in other sectors. These sectors are shunned by local youth, who are pushed by societal pressures into careers in the banking, services, or public sectors.

On the other hand, employers admitted to preferring to hire Palestinians and Syrians as they can do so for lower wages, no benefits, and no official contract. But these youths rarely make managerial positions, and some employers stated they always hire Lebanese for positions in direct contact with customers.

The results of this study were shared with another 2,000 youths living in the three target areas over the last six months, with information sessions to help them better understand how to approach labor market opportunities. Syrian and Palestinian youth were encouraged to seek safer jobs with better legal protection of their rights. Lebanese youth were told to pay attention to market needs and specialize in jobs in demand. Mercy Corps also called on employers to develop an “open-door policy” toward youth by creating short-term internships and mentoring opportunities.  As for the government’s role, the study suggests it should invest more in local businesses to increase job vacancies and invest in developing young people’s skills to better integrate them into the labor market.

March 14, 2019 0 comments
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BusinessComment

Creating a price-stable cryptocurrency

by Thomas Coughlin March 14, 2019
written by Thomas Coughlin

It has been a tumultuous time for cryptocurrency investors and advocates alike who have watched the market value of the industry drastically drop in the past year. However, some optimism is growing in the space as committed developers and blockchain advocates shun the daily obsession over price changes. The highly speculative nature of the crypto-market leads to price fluctuations, which can be very taxing on investors. To break free from this instability, industry professionals are now looking into using blockchain to create a stablecoin as an optimal digital currency that would have the following characteristics: price stability, scalability, privacy, and decentralization.

The value of gold

A useful currency should be an efficient medium of exchange, a unit of account, and a stable store of value; digital currencies excel at the first, but fail as a store of value or unit of account. A currency cannot be an effective store of value if its price fluctuates by 20 percent on an average day. This is where stablecoins come in. Stablecoins are price-stable digital currencies, meaning their market price is pegged to the value of an underlying asset, such as precious metal or fiat currency like the US dollar. By pegging their value to real-world assets, stablecoins promise price stability that can bring digital currencies into the mainstream, making the stablecoin the Holy Grail of the crypto ecosystem. However, with fiat currencies experiencing their own fair share of volatility, the historically stable nature of gold is looking increasingly attractive to investors.

In light of increasing political feuds and trade wars hitting economies around the world, gold has seen a surge of interest. Global gold purchasing in 2018 was 74 percent higher than in the year before, with central banks gold-buying hitting a half-century high. Physically, gold does not corrode nor shift in shape despite changes in temperature, location, and time. Even after thousands of years, gold remains pure and free from external elements, which allows for immediate processing, if needed. As a currency, these traits provide a sense of confidence that the value will be preserved.

This potential of innovative blockchain technology has attracted the attention of many industry experts. The institutional gold exchange, the Allocated Bullion Exchange (ABX), is leading innovation into how gold can be used as an international currency. Real, physical gold ownership is being digitized with ownership securely recorded on blockchain technology, so that physical gold and silver can be spent just as easily as fiat money, in the same way that banknotes used to be IOUs for gold. Incentivising use and adoption through a recurring income delivered via a unique yield system, which works in the same way as a bank deposit, incentivises use and prevents hoarding behaviors. This system combines new world-decentralized technology with the oldest, fairest, and most sustainable form of money, gold.

Throughout history, people have been fascinated by gold; it has been valued by civilizations across the globe and has been a significant part of the Middle Eastern culture for centuries. It holds deep economic and cultural relevance in these nations even today, maintaining its status over time as the most effective store of value. The UAE and Saudi Arabia are listed respectively as the fourth and seventh largest gold jewelry consumers in the world, according to the GFMS gold survey for 2018. The Middle East is also gradually embracing blockchain and cryptocurrencies, with Dubai setting a goal of securing all government documents on blockchain by 2020, and Iran last year announcing it is developing its own digital money.

Providing stability

By introducing a stablecoin with a 1:1 allocation to gold, a digital currency like Kinesis Money can provide the stability and liquidity required in the crypto space. Each stablecoin minted would represent a physical bar of gold/silver secured safely in vaults around the world, subject to stringent third-party audit and quality assurance processes. Not only will this assure investors of the stable value of their investments, it would also allow them to request the exact value in precious metals when physically needed. This will usher in a new era of stability to the crypto market, ensuring they are well on their way to achieving their ultimate goal—the development of a decentralized and internationally usable replacement to the current fiat-based monetary system.

March 14, 2019 0 comments
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BusinessCybersecurity

Investing in cybersecurity companies

by Thomas Schellen March 14, 2019
written by Thomas Schellen

When it comes to predictions for this year, there are some prophecies that are practically risk-free, even outside the notion that the biggest risks of 2019 are not related to financial markets or even economic uncertainty. One such virtually risk-free prediction is that the digital transformation will continue. Another safe one is that Big Data and artificial intelligence (AI) will not wither.

The list of safe predictions for aspiring cyber gurus goes on, simply because many upside and even more downside developments are beckoning from all spheres of the wide digital cosmos. E-government tools will help improve the efficiency of public sectors in countries that improve e-governance and digital identity facilitation. Cybercriminals will use new attacks, and there will be spectacular and horrific breaches. Some of the attacks by cybercrime syndicates will employ AI tools. The financial damages count from cybercrime will be a multiple—a very substantial multiple—of investments into cyber-defense by public and private stakeholders (and this will by far not just be the case in Lebanon).

Even scarier, new cyber terrorism incidents will happen and target infrastructure or IoT (Internet of Things) vulnerabilities. There will be an arms race toward building new cyberwarfare arsenals, and in the daily life of humanity, plain old digital shit will happen—and probably escalate to unprecedented calamities. Digital futures will baffle us beyond our expectations and all predictions will be dwarfed by reality. In cybersecurity, the biggest risk will be the human being, but there will not be a worthwhile cyber future without humans.   

What then is a non-geek enabled, or cyber-enhanced human being to do when one is faced with a digital future but has ethical and technical barriers against morphing herself or himself into a master black-hat hacker, devious digital snoop, or voracious cyber-predator? And what to do for someone, like an alert investor or an entrepreneurial whizz, who lives in a country that is lagging a felt 50 parsec (163 light-years, or more than 1,500 gazillion kilometers) behind its enemy state next door when it comes to creation of a competitive digital edge in robotics, artificial intelligence, and machine learning, as well as general corporate research and manufacturing for the cyber age, or cyber attack and cyber defense preparedness?    

If you can’t beat them

Just over a century ago, when wars were overwhelmingly matters of human mass mobilization and deployments of ships, tanks, infantry, and artillery, the patriotically minded in the warring countries were asked by their governments to invest in war bonds. Similar financing tools for looming global conflicts in the digital era have not been developed. However, adapting the paradigm that “if you can’t beat ‘em, then you should join ‘em” to digital transformation and the global financial markets environment, even investors from the most digitally backward countries at least can turn to developed stock markets for gobbling up slices of the digital future and the prowess of listed cybersecurity companies.   

Scanning the early 2019 results season in the investment landscape for interesting narratives of cybersecurity stocks yields another confirmation that digital security is one big bed of where the future lies. Undertaking a non-exhaustive or fully representative journey across February’s earnings news of companies with exclusive cybersecurity focuses or significant involvements in the area, Executive noted that companies tracked by exchange-traded funds (ETFs) made quite a splash. According to Seeking Alpha, an online financial publication, Fireeye—a cybersecurity company that was listed in 2013 and has a multi-year track record of rapid growth—achieved a 10 percent year-on-year increase in its billings in Q4 of 2018 and exceeded analyst expectations. Similarly, Fortinet, a cybersecurity company that, like Fireeye, is included in a pioneering cybersecurity ETF,  achieved a 22 percent increase in fourth-quarter 2018 billings and topped Wall Street expectations according to a report by Dow Jones’ MarketWatch.

In mid-February 2019, the stock of Israeli cybersecurity outfit CyberArk Software rallied as Q4 2018 earnings and profits greatly exceeded expectations. Akamai, a company with expertise in networks, cloud computing, and cybersecurity, for Q4, 2018 delivered 8 percent year-on-year earnings growth that was driven largely by a 36 percent year-on-year revenue growth in its cloud security unit.

And if you want to take a guess at what cybersecurity company Palo Alto Networks announced to investors in the last days of February: Yup, Palo Alto’s revenue was up 30 percent year-on-year in its fiscal Q2 2019 results and the numbers were above analysts’ predictions, while the stock rose over 8 percent to an unprecedented high.

Digital disruption 

All aforementioned stocks are on the portfolio lists of at least one cybersecurity-themed ETF. Further on, from lesser known niche players in cybersecurity to big established names such as the security and networking stalwarts Symantec and Cisco, market augurs promote them as promising on account of being anything from small risky plays with huge upside potentials to good investment opportunities because of strong share price performances and/or gain potentials, earnings-per-share forecasts, or dividend outlooks.

Prominent cybersecurity ETFs, such as ETFMG Prime Cyber Security Fund (known as Hack) and First Trust NASDAQ Cybersecurity ETF (CIBR) in the first two months reflected the good share price performances of stocks in their portfolios. Although both ETFs experienced a three-month slump in Q4 of last year, according to Bloomberg data CIBR at the end of February 2019 showed a return of 21.2 percent for the year to date (ytd) and a one-year return of 13.7 percent. Its three-year return was 21.1 percent. Also according to Bloomberg, Hack achieved an ytd return of 19.3 percent at the end of February and had one and three-year returns of 17.2 and 22.4 percent, respectively.

However, such fleeting observations should not be read as suggestions that individual investors and especially retail investors would be in for smooth rides to high returns by allocating large portions of their personal to passive funds with cybersecurity themes. For the moment, many analysts judge cybersecurity ETFs as having characteristics that justify minimal exposure even as the overall theme of cybersecurity might be perceived as a very attractive road to financial participation in the world’s digital transitions.

Executive asked Christian Gattiker, chief strategist and global head of research at Swiss bank Julius Baer, about his views on digital themes, cybersecurity stocks, and related ETFs for international investors at the end of last month when he came to Beirut for a presentation to the bank’s local clients.      

The economist (who confessed to an infatuation with technical analysis, despite his training as an academic economist, during the evening’s presentation to investors) confirms that topics such as cybersecurity feature within what the bank describes as the investment theme of digital disruption. However, his view is leaning to active investing strategies and he would refrain from passive or static approaches when it comes to the sector. “We advise using active investing on those topics,” Gattiker says. “These [digital disruption and cybersecurity topics] are highly active themes and many of these markets are winner-take-all markets. Thus, if there is any shakeout in the industry, you lose as an investor if you hold all of [the involved stocks] because you win on one stock and lose on eleven others.” 

According to the Swiss banker, investors parsing cybersecurity stocks should thus make their own decisions instead of buying into a themed ETF. He advises further that investors should rely on analysts who have a good track record in calling these markets and that investors also should be nimble as to shift exposure if they sense any surprising change in the markets for these stocks when one winning cyber solution starts to rise at the expense of its competitors.

But in the sum of what Gattiker perceives as the biggest race there is in terms of companies competing for the crown of digital dominance, and one where the final outcome might not be determined for up to 10 years, he concludes, “Digital disruption is a big topic and digitalized healthcare is another one. These are big structural themes that can be of advantage to investors, but in very specific companies.”

March 14, 2019 0 comments
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DiasporaEconomics & Policy

Bel Lebnééné calls for Lebanese Arabic to be standardized

by Jeremy Arbid March 13, 2019
written by Jeremy Arbid

Lebanon has a long history as a shipping and trading hub, leveraging its geographical location on the Mediterranean Sea and connecting mainland Europe to the Arab hinterland. It was several thousand years ago that religious texts referenced the peoples of Mesopotamia (in what is now modern day Iraq) first migrating and settling on the coastal lands of the area. These people were known as Canaanites. Later, the Phoenician civilization dominated the coastal lands of the Eastern Mediterranean and was centered around the present-day geographical borders of Lebanon. For a period, the Romans ruled over the area before the Arabs, and this was followed by a struggle over control of the region during a period known as the Crusades. Fast forward to the 1500s, and Lebanon was part of the Ottoman Empire for nearly 400 years until its collapse following World War I. From then until the Republic of Lebanon was established in 1943, the country was under the French Mandate. In the post-World War II period, following the lead of the politically and financially superior Americans, Lebanon, alongside many other countries, was integrated into the global economy. Throughout its entire history, it is thought that the maritime tradition has had as strong an influence on the country as religion, foreign control, or other cultural influences, and that the language spoken today in Lebanon is rooted deeply in its past.

Lebanon is, in a formal sense, very much an Arab country. Politically, it is integrated with the region through bilateral trade agreements and other pacts with neighboring countries, and is part of the Arab League, a regional organization fostering relations and common interests of its member states. Arabic is the language of formal settings and is the country’s national language, according to the constitution. However, the language spoken in everyday settings is not formal Arabic, but the local dialect of Lebanese Arabic. There is, according to Hsen Andil, co-founder of the new online collective Bel Lebnééné, a huge linguistic difference between formal Arabic and Lebanese, to the extent that they are two different languages. Bel Lebnééné aims to standardize a script for the local language and build a library of content. The collective aims to raise awareness and encourage Lebanese speakers to write and express themselves in Lebanese.

A common language

Andil and fellow Bel Lebnééné co-founder Mahmoud Rasmi suggest that the problem may be that Arabic as a language has not evolved; they have struggled in academic settings to convey technical subjects in Arabic, and instead have to revert to English. Latin and Ancient Greek was the lingua franca of academia until the start of the 20th century. Nowadays, English is the go-to language for the definition of terms of global capitalism. This is especially evident to journalists listening in on the English-to-Arabic translation at conferences where the speaker uses a term or concept in English, and the retranslation into Arabic does not come out very easily, meaning the concept gets altered and diluted. To see this in practice, bilingual readers can try this exercise: How does one translate data breach, meaning a security incident where digital information is compromised, into Arabic, and how would that concept be retranslated back into English?

In terms of audience size, the online collective has big potential. The main communities that could benefit are the Lebanese that live abroad as part of diaspora communities living mostly in North and South America, Europe, Australia, and Africa. They number in the millions, and, for many in the diaspora, formal Arabic is not a language taught to schoolchildren. Instead, many in diaspora households might only be speakers of Lebanese and may have limited formal writing and reading ability, and so Lebanese diaspora may consider Lebanese, not formal Arabic, their mother tongue. That means that when they visit Lebanon, or return to live in the country, they can speak and interact in day-to-day conversations but may struggle in formal settings or when reading or completing official paperwork.

Those that come to Lebanon seeking to learn Arabic often find out very quickly that the country, and especially in the capital, Beirut, is not an ideal place to study the language. This is because the language that is taught in the textbooks is not what is spoken on the streets outside the classroom. For foreign language students to learn Arabic in Lebanon is really challenging, and it is more akin to learning two foreign languages instead of just one.

At Lebanon’s primary schools the situation is similar, formal Arabic is taught, but according to 2017-2018 enrollment figures from the Center for Educational Research and Development under the Ministry of Education and Higher Education, more than half of Lebanese students (almost 550,000) are enrolled at schools that teach French as the primary foreign language, with about 48 percent of students (almost 520,000) enrolled at schools that teach English as the primary foreign language. Schools are licensed by the ministry to offer curriculum of the American system, the French system, or the International Baccalaureate system. However, the Lebanese official curriculum is taught alongside a foreign system, while the national exam, which must be passed to obtain the high school diploma, is offered only in Arabic. Often students have studied subjects, such as science or math, in English or in French. Those test subjects are part of the national exam, with their terminology transliterated from the foreign language into Arabic.

Standardizing Lebanese

At home, Lebanese tend to speak the local dialect and not formal Arabic, and there are some households where French or English is the dominant language. Media in Lebanon, such as the newspaper or news broadcasts as well as books are mainly delivered or written in formal Arabic. Locally produced television programming is often in the colloquial dialect with foreign productions dubbed, or subtitled in formal Arabic. But now in the digital era, many of these mediums are not as widely consumed as they once were. This makes practicing formal Arabic outside of the classroom somewhat challenging for Lebanese students and for foreign language learners.

Andil and Rasmi think of formal Arabic as almost a dead language. It is not an extinct language, they say, because it is still used in religious and formal settings, but dead in the sense that it is not commonly heard in day-to-day conversation. Lebanese is unique from formal Arabic in that it incorporates terms and concepts from other languages. This is most easily seen through code-switching, a term that refers to alternating between languages during a conversation. At its simplest, there is the famous phrase “Hi, kifak, ça va?” and conjugating words using spoken Lebanese Arabic rules, such as the use of “bonjourayn” to reply in greeting.

Bel Lebnééné looks to standardize spoken Lebanese into a written format and to build a library of content to make written Lebanese more mainstream. The two co-founders point to poet and prose author Maurice Awad, financially-inclined academic Nassim Taleb, and other well-known authors that wrote in Lebanese, such as Said Akl and Talal Haidar. Their effort is not one with political goals—they do not aim for the collective to serve as a platform promoting national identity, but to express themselves better when talking about philosophical, political, or economic issues, and to inspire Lebanese to write as they speak.

March 13, 2019 0 comments
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Economics & PolicyQ&A

A new legal class on digital

by Thomas Schellen March 13, 2019
written by Thomas Schellen

Political class is not always a flattering term. Actually, undercurrents of personal animosity and/or political criticism are endemic when discussions turn to the political class—in any country. In Lebanon, the most frequent connotations of the term appear to be wasta and corruption. Hailing from a political family is in this sense a definite reputational burden in the court of public opinion.

However, in reality there are as many nuances on political positions and achievements as there are political individuals in Lebanon, and the task of legislating a framework for the country’s digital transformation is much more important than bickering over ideology. As a significant stepping stone toward the digital future, Law 81 was adopted by Parliament last year and went into effect on January 19. Executive sat down to interview MP Nadim Gemayel, the head of the Parliament’s information technology committee and lead sponsor of Law 81.   

E   Do you already have a sightline on how Law 81 is impacting the Lebanese economy and being adjusted to by enterprises?

Until now, we have not had any feedback about the application of Law 81, since it entered into force on January 19. After 10 days, we still have no feedback from enterprises. But I am sure that over the next six months [the law] will provide an easier way to do business in the country, especially for e-commerce enterprises and for e-banking. We are also contemplating an enhancement [of the law] with regards to dealing via emails and electronic transactions, especially concerning processes that used to be paper-based in terms of C2G [consumer to government] transactions and payments. This relates specifically to the realms of government to consumer and government to business interactions, or G2C and B2G, in areas such as payments at the ports and all kinds of e-payments. We are contemplating this, together with many companies, in order to provide them with the best environment, even though we do not have e-government yet.

E   Does this plan for new legislation interlace with projects under the CEDRE framework and initiatives coordinated with World Bank-related projects, such as the streamlining of customs procedures?

Exactly. It all goes together. It is not only about CEDRE, but about creating a real, modern country that has [digital] procedures and regulations that extend all the way.

E   So what are the most important points in Law 81 from your perspective, as its sponsor in producing it in Parliament?

Law 81 has three main aspects. The first is the civil law aspect, the second is the penal or criminal law aspect, and the third is organizational. The most important one is the aspect on civil law. This aspect includes four chapters. The first chapter includes the e-signature, all sorts of e-transactions, and electronic writing. Then there is the e-commerce chapter, an e-banking chapter, and the data protection chapter. These are the four main chapters [under the civil law aspect]. Then you have the criminal law aspect that covers all kinds of electronic crimes and cybercrimes, hacking, etc. All this is being covered under the penal aspect. The third aspect or section is the organizational one that provides [measures for the organization of] .lb and on how to manage internet service providers and data service providers.

E   So, under the penal section of Law 81, cybercrimes and their penalties are clearly defined?

Yes, there are penalties for hacking, for intrusion into [IT] systems, for pornography and child abuse over the net. There is a set of [legal sanctions] for e-crimes.

E   Is there also a provision in the law’s penal section that deals with online harassment or bullying over the internet?

No, harassment is not included. It is still very general. The section has a set of articles that address a small part of the e-crimes but does not go into [all forms of] abuse, social media, or freedom of speech.

E  This sounds as if victims of online trolling in Lebanon might, for the time being, still have to resort to the existing judicial means when seeking protection. As concerns the organizational section of the law, you say that the .lb issuance is included?

On the organizational [segment] we have two chapters, one that is related to regulating the .lb—I personally have many reservations about this chapter because it is very badly done, and it was changed at the last minute in Parliament. It is not applicable, and we are attempting to change it again.

E   What is the weakness of this chapter?

[By changing the text of Law 81, members of Parliament] created an entity to manage .lb that by law cannot be created; there is a contradiction in the chapter. There is another chapter in the organizational section of Law 81 that talks about all kinds of [Internet Service Providers and Data Service Providers] and all kinds of servers.

E   You mentioned in a speech at a cybersecurity conference on January 31 that the law is a step toward something comparable to the EU’s General Data Protection Regulation, or GDPR?

Right. This is the part that is related to data protection. This is in the fourth chapter of Law 81’s segment relating to the civil aspect. We have a foot in the water in terms of data protection but it is not yet complete data protection, similar to GDPR.

E   So it is not yet in the organizational segment?

There is a small [data protection aspect] in the organizational section, on how companies are to do business, and how [they are] to be regulated by the ministries.

E   What is your perception regarding the readiness of Lebanese companies that do business online with European customers?

Any company that wants to deal with European citizens, or do business in Europe, has to comply with GDPR. This is much stronger than our data protection regulation, but the companies in Lebanon will still have to adapt to Law 81.

E   Is there enough awareness and training in Lebanon on how to comply with GDPR, noting that European countries have recently appeared to enforce the regulation with larger fines?

It is not enough. Probably only banks are aware of all the procedures related to GDPR. But in the overall Lebanese market there is no awareness at all, and especially there is no awareness in the ministries that have to apply the data protection. That is why I requested a meeting on data protection last week with the ministries on how to implement the data protection. There was a sort of mess in this regard.

E   What sort of mess is this? Is it concerning all ministries? 

We have four ministries that are related to data protection. We are trying to coordinate the [issuance] of decrees that these ministries have to release. The Ministry of Justice, the Ministry of [Public] Health, the Ministry of Economy [and Trade], and the Ministry of Interior [and Municipalities] will all have to coordinate in order to have a competent structure [for data protection].

E   How do you perceive the establishment of a new ministerial role, namely the Office of the Minister of State for Information Technology and Investment, in this context of need for coordination on digital policies and processes?

I heard very good things about this minister as being very competent and trustworthy. [Ed: a first meeting between MP Gemayel and Minister Afiouni was arranged after Executive conducted this interview.] I hope that we will be able to cooperate with the new minister for [information technology], in order to organize this sector and move it forward to achieve better expansion.

E   How is the situation, or need, in terms of implementation decrees for Law 81?

Some issues need regulation by the ministers, and some issues need government decrees. This should all be set [soon]. Law 81 needs about 10 decrees, and we are pushing the ministers. These decrees should have been implemented [in January 2019], but since there was no government [at the time when Law 81 went into effect], we are giving them a few weeks to organize themselves to start decreeing what needs to be decreed.

E   You serve as head of Parliament’s IT committee. How do you see the digital awareness of fellow members of Parliament?

The awareness is very good. This is a domain that is very young, dynamic, efficient, and that is evolving very quickly. Of course there are some colleagues among deputies who are more aware than others, but each is [aware] about a sector. Even I have been thrown into dealing with this sector, and did not know all details about it, but I decided to take this into my hands. We are also making efforts to improve our knowledge of all relevant issues. For example, we are organizing a trip for all parliamentarians in the [IT] committee to Estonia, which is the number one state for e-government, cybersecurity, etc. We will be going there to discover this horizon and take the necessary training to know what to expect.

E   A fact finding tour?

Exactly, a tour to study, have e-government meetings, regulatory meetings and all this. [Ed: the tour had been conducted by the time of publication.]

E   Without resorting to external ratings of Lebanon’s digital readiness by think tanks and organizations such as the World Economic Forum, how do you personally rate Lebanon for digital and cybersecurity development when comparing it to peers in the Middle East?

Without having other criteria, from a legal point of view I think we are very late. [Law 81] was the first time that a law concerning IT and e-transactions was voted into existence. It has been a first step, but other countries are very advanced in this. I also believe that we need to do a lot in the ecosystem, from education to evolving job descriptions for people to know from the beginning that we need different jobs from the traditional ones. We also need to reach new markets, find new horizons, and new ways to integrate the values of Lebanon into companies within this [digital environment]. We are late.

E  Two years ago, Executive published an analysis by a legal expert on digital legal frameworks in the region, and it indeed showed that Lebanon was behind the regional curve in legislation and adoption of policies for digital transformation as well as in cybersecurity issues.

It is far behind, but I can add one comment: Lebanon has always been known for private initiatives and personal initiatives in adopting new technologies, evolving new sectors, etc. I believe that this time, the state needs to be following the private sector. We [in the state] must not be afraid to say that we are following the private sector. The private sector should be the pioneer and lead us. We are there to support them.

E   In this context, it appeared from recent conferences on the digital ecosystem and cybersecurity, such as a Cybersecurity Day at the American University of Beirut, that Lebanese students are extremely eager to learn more skills in areas such as cybersecurity. Do you agree?

Of course. Cybersecurity is the future, not only for the state, but also for your personal digital identity.

E   Do you recommend any specific steps that the state should take under the concept of following the private sector in the areas of digital innovation and cybersecurity? Should the state, for example, devise new curricula for tertiary education on cybersecurity?

No, but I believe that much should be done to make people from a very young age learn how to think differently and orient themselves in this area. It is also very important to create jobs in this area. Awareness is very important. Digital is part of our daily life. It’s like learning how to drive a car—understand your limits. In a similar way, you need to learn how to use the [digital] technology around you. You have to know the limits that you have in this technology and how to protect yourself.

E   Should the state take a leading role in education for digital, or should this digital transformation be driven by private education providers?

Both have a role to play. The ministries and the government have to play a role, and the whole public sector has to play a role, but it is complementary. It is similar to how creating awareness of child abuse problems is part public and part private responsibility—it is part of schools, cultural clubs, families. It is about everybody.

E   For the interaction with the government today, are there special contact points at Parliament for the private sector, where companies can relate to the IT committee?

Of course, I am open to everybody, and I’m talking with all the sectors. Our committee engages on education, with the Ministry of Telecoms, with IT companies, with the clusters, with everybody. We are trying to talk to everybody and be part of [answering] their needs and requirements.

E   How are you dealing with specific situations involving state contracts and work on issues such digitization of the cadaster?

We have yet to start on this issue, which goes into the development of e-government. This issue requires many strategic decisions, for example, who will own the data and what will be the [ID] number that you use to identify yourself? Will it be a number [given to citizens] by the interior ministry, the finance ministry, or any other ministry? We need to define this [ownership of data] first, and this has been a big debate; the ministries still do not accept to share their data among each other. If you do not organize this today, especially between the Ministry of Finance and the Ministry of Interior [and Municipalities], you will not be able to go forward.

This is because you need the personal, individual [data]—name, family name, and date of birth—as well as the financial information, and the data from the Ministry of Justice, which owns the cadaster. It is a management of three [ministerial stakeholders], of whom each considers themselves to own the data and wants to preserve it [at their ministry] without sharing it with anybody. This is problematic. It is where we are today, but I think that we shall be able to find a solution very soon. Also, let me tell you about another innovation that we [in the IT committee] are working on: I am proposing a law on companies in technology that will be favorable for entrepreneurship and startup companies in the digital ecosystem. This law aims to provide simplified [processes] and quick registration, where we will waive many [requirements] for young companies in order for entrepreneurs to be able to start new tech companies and take them forward very quickly.

E   Would this also involve smoothing of access for young tech companies to the Electronic Trading Platform, or ETP, once this entity is established?

The issue is completely different. [The new legal proposal] is for companies that seek to be incorporated in an easy and light process. That is what we are doing. If these companies later want to join the ETP or evolve onto the Beirut Stock Exchange or somewhere else, they are free to do what they want, but [this law will be there to help them] if they are young startups and want to go forward.

E   It has been a request from participants in the entrepreneurship and tech startup ecosystem to have simpler incorporation requirements for startups. Is your new law proposal addressing this issue then?

Exactly. This [sort of complex requirement] is what we are going to waive. We are helping the [startups]  do things. We know very well that perhaps two of 10 startups will fly. For the rest, we are facilitating the bankruptcy or shutdown, and in case that they are flying alone, we will facilitate their registration so that they can get integrated into the ecosystem. I hope that this law that we are preparing will help a lot in this way. It is a new law that I have not proposed yet, but plan to launch in the near future. It is being drafted.

E  May I ask how you personally first became involved with the issue of digital empowerment, and what made you aspire to become the chair of the IT committee in the current Parliament?

I have always been interested in IT and technology issues and digital identity. In the last Parliament, I was a member of this committee that, at that time, was chaired by my colleague, [Tripoli MP] Samer Saadeh. So when Samer lost the election [last May], I proposed to become the chairman of the IT committee. I nominated myself because I believe this sector is the future, where a lot needs to be done, and where I have a lot to give.

E   When you gave a speech on Law 81 and your perspectives on the challenges for politicians in the digital era at the end of January, you referred in the conclusion of your speech to issues of leadership and influencing—specifically the dilemma of whether politicians will resort to following the demands and pressures exerted on digital social networks, or if the networks should follow the politicians and their leadership. Would you elaborate on how you perceive this issue and what you see as the appropriate paradigm for digital political behaviors?

I believe that, today, big data is corrupting our mindset and is also corrupting the way we see things in society. It probably is also corrupting the values we have. I believe that, while [digital influences] can corrupt, we should not lose our values, our credibility, and our identities, or the human way of thinking. Data should help [politicians in making decisions] but it should not be [directing] our decisions instead of ourselves. I am pro-technology and pro-evolving, but I also believe that humans still need to [stay in charge]. There are many stories about things like dataism and the danger of data today. We cannot control it, but we need to contain it. 

March 13, 2019 0 comments
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Economics & PolicyQ&A

Interview with the new Lebanese minister of state for information technology and investment

by Thomas Schellen March 13, 2019
written by Thomas Schellen

Lebanon is well-acquainted with the true diaspora returnee: the individual born in Lebanon who departed at some point in the 20th century, who has one or multiple tertiary education degrees—often earned at a ranking European or American university—and who succeeded in his career abroad before returning to Lebanon, for reasons ranging from family responsibilities or/and love to entrepreneurial hunger and will to invest. Some spirited entrepreneurs even get involved in diaspora organizations.

However, while this personality is frequently encountered in the entrepreneurial private sector economy of Lebanon, it has not been so common—at least for several political generations in positions of power, until the arrival of the 2019 Council of Ministers—to meet a minister that fits the profile. Executive sat down with Adel Afiouni, minister of state for information technology and investment, to understand his vision for this new role. Having been able to check the above-mentioned achievement boxes on Minister Afiouni’s professional track record in education and international banking, Executive is now standing by to tick off the delivery boxes on the new ministry’s KPI fulfillments or flops in the coming years.

E   What is your perspective on knowledge economy development in Lebanon, including the state of the digital ecosystem and the readiness of our cybersecurity?

I have not yet gone into the details of the cybersecurity topic. I just started and am first mapping the space. I am pretty familiar with the ecosystem, with the entrepreneurs, the VCs, and the government entities on the knowledge economy side, but in my first few weeks on the job I want to do a full mapping [of the digital landscape] and listen to all the key stakeholders from the government and the private sector, so that I can figure out what mandate I want to design for this ministry, what is the scope of work, and what is the vision that we want to achieve. From there, I want to determine the strategy and the deliverables. My ministry is actually a startup, which goes well with the way in which I like to operate. I am very excited about this and want to operate it in the way you found a business.

E   Are you, in the sense of a startup enterprise, bootstrapping?

In my opinion, the ministry has a very strategic role, and I myself have high expectations as to what we want to achieve. I also am dealing with stakeholders who have high expectations, as this sector is, by definition, a fast-growing sector with entrepreneurial participants. I want to build a long-term strategy with clear deliverables.

E   Of course, one does not expect a ministry to bootstrap, but there have been instances where entire ministries had no clear budgets and were forced to resort to tapping into external funding sources. Do you have a budget?

There are challenges. [The ministry] is a startup, and funding is obviously a key component when you build a startup. We have a commitment from the Prime Minister to grow this ministry and deliver on our ambitions. I need to submit a plan with a budget. If you look at the policy statement [by the Council of Ministers] that was presented to Parliament [in February], there is a portion that says that ministers of state will be given resources, including budget[s]. We have to ask for [such allocations] as we operate in an environment where we can obviously not overspend. We have to be very rigorous [on spending control], and I do not have any issue with leveraging existing resources and cooperating with a lot of stakeholders inside the government. There are some ministries where there is complementarity and scope and the need to cooperate, like the Ministry of State for Administrative Reform (OMSAR) and [the Ministry of Telecommunications]. All ministries effectively are partners, we are all partners in the project of digital transformation. There are also large components of the private sector who want to be involved and help. We need to leverage those resources.

E   As you mentioned, more than one ministry has been a stakeholder in building IT capacities in public administrations and Lebanon’s transition into the knowledge economy. OMSAR was a stakeholder together with UNDP in developing an e-government strategy document as far back as 2003, and then in producing another, similar strategy document that was published late last year. Did you already have time to look at the priorities as they were presented in those papers and determine which of them you will pursue as minister?

Yes, you are right that we had a number of strategy papers and strategic initiatives that we need to execute; the key is execution. I looked at a lot of documents, not only from OMSAR, but every ministry had developed [such documents and plans]. Some administration units have made substantial progress, but others are a bit late in the game [in terms of digitization]. We have not implemented the full strategy so far, so we can leapfrog. There are new technologies and new ways of digitizing the government and the economy. That is the first priority item.

Secondly, this government has a strong commitment to the knowledge economy as a pillar of our strategic vision for the economy. Therefore, and this is also in the policy statement, there is a strong commitment to the digital transformation of the administration and the economy. We are going to start discussions, such as [convening] inter-ministerial committee meetings. The key for such initiatives, in my experience from other countries, is to first put the governance in place. The strategy is key, but the governance is fundamental for executing it. We need to establish the governance structure and decide on the role of each ministry within the governance structure and how we will work on a shared infrastructure platform to be most efficient. Beyond this, each ministry or administration obviously will have its own [digitization] priorities and implementation inside the governance structure that can oversee the execution and [fulfillment of] KPIs.

Now, going back to my own priorities in entering into this position, I see the scope as twofold. One scope is the digital transformation of the government. That scheme has, for many reasons—transparency, efficiency, and the journey of the citizen—to be made much easier. This is important for the economy, but also for regaining the citizen’s trust in the government. That is one side of the scope. Equally important is the second side: the emergence of Lebanon, from an economic and business perspective, as a hub for technology and the knowledge economy. This is a sector where we have many advantages and have the potential, contrary to other sectors, to grow and become a meaningful player in the region.

For me, therefore, there is the digital transformation of government, where I have to work closely with every partner in government who is involved—[which is] pretty much everyone. OMSAR has done a great job in setting the stage, but we need to progress from there. And there is the private sector, business side to the knowledge economy, which we need to grow and transform from an emerging sector with a lot of potential into a well-established center for the region.

E   What is your position on interaction with the academic and civil society sides?

I have many ideas on that side but, to be fair, I need to develop these further. This weekend I spoke with the minister of education to jointly organize meetings with all the large universities and come up with a strategy where the universities can be actively involved in our vision and plans. When I talk about the private sector and how we can transform Lebanon into a business hub in the knowledge economy, enablers are key. Two enablers are first on my list. One is infrastructure, and that is where our neighbors at the ministry of telecoms are set on improving the infrastructure in the whole country. The second enabler is education, research, and development. We need to create [intellectual property] in the country; we do not just want to be an intermediary. To do that, we need strong research and development. We need to adapt the curriculum in the universities to the business world and to the new technologies. It is a part of the strategy and very important for us to include new technologies in the curriculum, starting with schools. I have friends in Parliament in this, and, for example, MP Nicolas Sehnaoui is going to propose a new law on introducing technology subjects in schools. We also need to do the same at the university level, where we need to introduce new technologies and link the universities better to the business ecosystem. All this is starting, but I think we need to turn it into a focused plan.

E   If we turn to talk about the business community and specifically the financial sector, what is your perspective on the role of banks, and especially the function of Circular 331, for the development of the knowledge economy in Lebanon?

I think Circular 331 has been a major catalyst that has effectively jump-started the whole ecosystem [of the knowledge economy]. As we all know, you can have many plans, but if you have no funding for a plan, you can’t progress. I salute [Banque Du Liban Governor Riad Salameh] for his vision on this. [Circular] 331 has been a fantastic initiative, and what it did was basically make capital available to the startup ecosystem. Our role in government is not only to support it, but to complement it. [Circular] 331 has brought the banks as major investors into the ecosystem, but there are other types of investors that we also need to bring in [to] diversify the funding sources for the ecosystem. The most important thing is for our country to attract capital, not just in the form of deposits, but in any form of investments. Thus, we need to supply those other investors with sets of incentives and support. We have a pool of capital available, which mostly is diaspora capital, that we need to attract and encourage. So far, we have focused on this pool mostly as a source of deposits. That is fine, but we have to also attract them for investments in productive sectors. One of my priorities as minister for information technology and investment is to see how we can attract more diaspora capital to productive sectors in Lebanon, and in particular to the knowledge economy sector by providing support, help, and incentives.

E   Does the minister of state for information technology and investment then also have a vital stake in collaboration with the central bank and the Capital Markets Authority of Lebanon?

We have a great relationship with the governor and the CMA, and we complement each other. We have to work hand-in-hand supporting crucial flows of capital into the country.

E   Does your sightline also extend to a perspective on financial sector companies and banks on issues such as new payment solutions in the country?

Anything that makes the ecosystem more efficient, where we can see potential for growth and that helps us with digitization and the digital transformation of the economy has enablers that are important, and one of them is moving into a cashless society, where payments can actually be made in a more efficient and transparent way. This is part of my priorities.

E   In order to create a virtuous cycle or upward development spiral for Lebanon’s digital transition, it seems that this country needs to achieve much: investments, reforms, cybersecurity, digital identity, and e-governance. As the country would work on all these issues, do you see them as priority needs that are best pursued consecutively or concurrently? Phrased differently, must we achieve a succession of milestones or will it be better to work on all fronts at the same time?

As I see this, the tracks are parallel, and we should avoid taking on [digital transformation] one step after another. If we have a governance structure and agree on a common platform or shared principles, everything should go in parallel. [In this way,] we will actually create a virtuous cycle. For example, we will not wait for everything [else] to be ready before going to attract investment. This is because having attracted a small investment sometimes puts pressure on other things to progress faster.

E   On the cybersecurity side, there seem to be several options in the sense of having centralization in the management of citizens’ data and single-source issuances of digital identity files or having more of a decentralized approach. Do you favor one approach?   

I have my views on that as I’ve done some work on [such issues] in my previous work. However, to be fair, these are sensitive matters that touch on national security. They involve the Ministry of Defense, the interior ministry and many organizations. Thus I would rather first discuss these matters and hear views from different parties before we can come up with a solution. As far as I’m concerned, it’s very important to take into account some of the opinions from inside the government, especially from [the] security [establishment].

As I mentioned earlier these [cybersecurity issues] are matters where we’ve been a bit too late. At this stage, where we already have digitized a lot of data, we need to put the mechanism in place to protect our country and our citizens. It is also very important to protect the privacy of citizens’ data.

E   Are we going to see another national plan on cybersecurity and other digital and e-government issues, something such as a national digital strategy, the next edition?

I hope we don’t need to recreate this because there’s a lot of good work that has been done. One of the reasons I see for delays [in implementing a national digital strategy] is that we’ve seen a lot of strategy papers come in. They keep reinventing the wheel. I prefer if we actually leverage the work that has been done and really [do this] in the near term. We will agree on a deadline [for the government’s digital transition] so we [can] start implementing [the strategy]. We can get inspiration from a lot of countries that were in similar situations. We need to execute [our strategy].

E   One of the experiences that have marked periods of technical migration and innovation seems to have been that in taking these steps, countries have tended to make mistakes. Perhaps it has even been necessary for administrations to make mistakes on the road to e-governance and learn from them. But as for Lebanon, it seems today that we are out of time and cannot afford to make mistakes and learn from them. How would you solve this challenge?

Hopefully we can progress faster by learning from other countries’ mistakes and journeys into digital transformation. We honestly just need to have a clear governance—something that we don’t have today—and then this governance will lead to the assignment of [the needed] roles. Some of these roles will be handled at the ministry’s level, but to make things more efficient, shared infrastructure, with the ability to communicate between government entities and use similar tools, is very important, and we do not have this yet.

March 13, 2019 0 comments
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CommentEconomics & Policy

Building Lebanon’s destination marketing to fuel growth

by Samer Elhajjar March 13, 2019
written by Samer Elhajjar

Lebanon has long been a crucial center for creativity and innovation, and is reputed to have some of the most successful advertising agencies and marketers among its citizens. Yet the country does not have its own marketing plan. There is no unified strategy for promoting Lebanon as a country to either tourists or investors. It is of the utmost importance, then, that the government develop a cohesive country marketing strategy that could play a role in alleviating the economic situation Lebanon faces.

The post-war situation in Lebanon has been marred by instability, with political conflicts hindering any reform efforts to improve government finances. The deteriorating economic situation since 2010 has burdened the private sector and led to worsening conditions for conducting business. In order to fuel economic growth, the government must re-brand the current image of Lebanon, from a risky unstable country to a safe and stable environment. 

Globalization has led to increased competition among countries as they attempt to secure more resources and attract more foreign investment, both of which have a direct impact on social and economic development. The stability of nations in this aggressive global environment has relied mainly on their ability to create and promote competitive advantages in order to attract investment. Country marketing has become an essential tool used by governments to increase their competitiveness, promote local development, and attract foreign investment. In this context, national governments must act more like business entities, whereby territories are regarded as products that should be marketed and branded to increase their attractiveness to investors and stakeholders.

In Lebanon, a unified marketing strategy for the country has been attempted before. In 2001, then-Prime Minister Rafic Hariri tried to develop a brand for Lebanon in a holistic and coherent way. However, this effort did not materialize due to Hariri’s assassination and the political instability that followed. After the assassination, isolated efforts were made—by the tourism ministry, among others—to create a brand image. However, none of these efforts made it past the planning stage due to a lack of political will and support. Today, the brand image of Lebanon is very fragmented, and there is no conscious effort by the country to develop it. The failure of the government to create and communicate a unique brand for Lebanon has led to the country being perceived with indifference by, for example, its regional neighbors and European markets.

Isolated efforts undertaken by ministers and public influencers cannot create a national brand for Lebanon. If the government wants to play an important role in the region, it has to adopt the marketing tools that will help Lebanon project a better image. To effectively brand Lebanon, the cabinet must first develop its capital market strategy, which includes segmentation, targeting, and positioning. In Lebanon’s case, two groups need to be courted: small and large investors. Small investors—the European market, for the most part, in addition to the GCC—should be courted by the creative and production sectors in order to attract investment in gastronomy and agro-industries.  Large investors, namely the GCC market, should be courted by the financial and tourism sectors; the government should make a special effort to promote Lebanon in the GCC region.

To attract these markets, Lebanon should be positioned as a stable, safe, and alluring destination with fertile ground for investment. Another important step in its territorial marketing strategy is to develop differentiation tactics to attract investors and tourists. Any country marketing strategy should work to highlight any factors that differentiate Lebanon from its regional competition. The Lebanese people’s innovativeness, creativity, and entrepreneurial mindset can be regarded as the main differentiator in Lebanon. Other assets include: the diversity of opportunities that Lebanon offers to investors in various industries; the vibrant, multicultural nature of the country; and the rich natural resources and agriculture conditions.

Finally, the government should make national security a priority to aid the implementation of any marketing plan for Lebanon. The government should also establish an open market economy with high levels of foreign direct investment and local savings. The government strategy should stress that the state’s role in economic issues is important but limited; it should develop the legal framework for an economy in which the private sector is the main actor.

March 13, 2019 0 comments
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Since its first edition emerged on the newsstands in 1999, Executive Magazine has been dedicated to providing its readers with the most up-to-date local and regional business news. Executive is a monthly business magazine that offers readers in-depth analyses on the Lebanese world of commerce, covering all the major sectors – from banking, finance, and insurance to technology, tourism, hospitality, media, and retail.

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