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Refugee economics 201 

Lebanon’s interconnected lot

by Thomas Schellen

Mental planning exercises for a more difficult world may be appropriate for G7 countries or risk summits at the World Economic Forum. Countries in the Middle East crisis region are already experiencing what it means to be exposed to active existential threats. For Lebanon, the recent Brussels gathering of European bureaucrats, representatives of the concerned Arab governments, and Middle Eastern civil society stakeholders means many nice wishes, reiteration of the call for political solution in Lebanon as well as Syria, plus some underwhelming financial support numbers. 

A Lebanon fact sheet published on the European External Action Service (EEAS) website in conjunction with press material after the Brussels meet says that pledges from the EU and member states to displaced Syrians and host communities in Lebanon have risen to a cumulative tally of €3.14 billion for the past 13 years. As fact sheets also reveal that out of €33 billion provided by the EU and its member states in response to the many-tiered, multi-country Syria crisis since 2011, this means around 9 percent of the cited EU crisis responses have been dedicated to Lebanon.

Related EEAS fact sheets for Syria, Jordan, and Turkey disclose amounts of €2.3 billion EU assistance inside Syria, €4 billion in Jordan, and €10 billion in Turkey. From Lebanese citizens’ perspective, these numbers almost must be interpreted as both underwhelming and unfair when the stated EU support amounts are considered against the humanitarian needs in the four countries. 

For example, the Turkey fact sheet cites 2.7 and ca. 2 million refugees in the country as benefiting respectively from protection services and cash transfers for basic needs, presumably as part of EU humanitarian assistance at €3.6 billion value since 2011. Contrastingly, the fact sheet on humanitarian assistance delivered to Lebanon’s people in need – “vulnerable Lebanese and refugees from Syria” – mentions ca. 1 million beneficiaries from protection and social cohesion related services and 1.1 million that received livelihood support. Yet, the overall value of EU humanitarian assistance to Lebanon is cited as €867 million, seemingly indicating that just over 24 percent of the humanitarian assistance given to those sheltering in Turkey was allocated to Lebanon’s targeted people in need. 

The strictly local angle: Missing elements and contradictions

The numbers leave room for further questions from noting that the amounts in four EEAS fact sheets on Syria, Jordan, Turkey, and Lebanon are not summing up to the cited €33 billion value of the EU’s and member countries’ aggregate support from 2011 to date. This discrepancy can certainly be explained in more careful accounting of delivered EU assistance than is offered in flashy one-page infographics. However, it draws attention to a larger dichotomy: Numbers on the international assistance to the country are simultaneously convoluted and underwhelming.

In addition to being underwhelming under the aforementioned mandate of burden sharing, donor contributions to Lebanon, as to Syria and Iraq, are over all of the last 13 years decidedly lacking in relation to the humanitarian and development needs that exist. Yet at the same time, messages sent in response to regional aid appeals have been contradictory as both donor determination and humanitarian needs have been habitually overemphasized in strategic and crisis response plans by whatever international agency/agencies under whatever name. 

The futility of this communication strategy is glaringly reflected in the growing gaps between initial asks and provided funding for humanitarian and development purposes. Initial asks for funding of needs in Lebanon under the Regional Refugee & Resilience (3RP) and Lebanon Crisis Response (LCRP) plans rose from $1.7  billion in 2013 to $3.4 billion in 2022 (and $3.6 billion in 2023) but the coverage ratio which had vacillated above 45 percent and peaked at 54 percent in 2015 and 2020, dropped below 40 percent in 2021 and 22. 

Data for the first quarter in 2024, under the new label of a consolidated Lebanon Response Plan (LRP) in place of the previous LCRP and locally focused, “strictly humanitarian” Emergency Response Plan (ERP) show that a total ask of $2.7 billion received 10 percent new funding between Jan 1 and March 31 of this year.

The absence of reforms and macroeconomic success in the regional crisis and its constituent countries raises doubts if lower aid commitments are merely expressions of donor fatigue and tighter budgets in more challenging times. But irrespective of reasons and the absence of new and compelling donor-funded regional and national development strategies that would explain the changes of crisis response plans, the fact to note most is how the lack of regional initiatives and governmental reforms matches or rather exceeds any issue that one can have with the international donor community.   

Bad arguments, more missing elements, and more contradictions 

International burden sharing is essential for Lebanon’s recovery from its economic crisis. Accounting for costs of sheltering refugees on the Lebanese side of the equation, which would help in constructing a clearer path of economic recovery, however, has been a missing element of the equation on the Lebanese side. 

Moreover, instead of making genuine societal efforts at drawing up a balance sheet of the complex profit and loss with nuanced accounting of divergent factors in the economy of the crisis-embattled country, national stakeholders on all sides of the debate on displacement and Syrian refugee impacts have only instrumentalized unverified headline cost numbers of hosting refugees. This rhetoric, while present since the start of the refugee influx and spiking several times at different times in the intervening years, has in 2024 escalated into what many foreign observers have judged to be attempts of refugee scapegoating and demonization. It is juxtaposed with unmet economic opportunities. 

Lebanon’s two arguably most critical areas of socioeconomic development since the start of post-conflict reconstruction and development in the 1990s under the stewardship of Rafiq Hariri were healthcare and education. Both have seen attempts of public-private sector collaboration as well as several decades of growth of private sector educational and medical services industries with significant regional expansion potentials. 

In the context of politicized debates over provision of medical and educational services to displaced Syrians, however, angles of economic performance and opportunity were left unexplored and replaced with counterproductive and contradictory approaches. 

90 percent for them, zero for us?

An example for an often-heard but factually incorrect and economically and socially deeply counterproductive non-argument in the healthcare file of the Syrian presence is has been in the time of the Lebanese economic crisis that UN agencies cover “90 percent” of hospital treatment costs of Syrian mothers in delivery rooms. It is a claim that is not infrequently laced with sentiments of fear over high birthrates among displaced the displaced Syrian population in the country. Reports say 350,000 children have been born to Syrian mothers in Lebanon since 2011, with some seeming to think that having babies while living as a refugee was a purpose of moving to Lebanon. 

The widespread popular assumption of 90 percent medical cost coverage for a delivery by a refugee woman is factually incorrect, UNHCR resident Ivo Freijsen tells Executive with view to the increasingly severe financial limitations faced by UN agencies that also curtail medical coverage. He explains that “an increasingly small group of Syrian refugees are getting a level of compensation on very serious conditions” but that regular 90 percent coverage of costs associated with a child delivery “has never been correct, has not been valid often, and is definitely no longer valid now”. (see interview)

Emotive criticism of the alleged comfortable medical coverage of Syrian women in childbirth is a meme of comparison whose second half argues that Lebanese mothers cannot benefit from such fundamental assistance. This, however, makes the meme politically and socially explosive but at the same time socially and economically counterproductive. 

While lack of coverage for prenatal, natal, and postnatal medical needs of Lebanese women is a glaring failure, it is a failure of the Lebanese healthcare system. This failure’s origin can be traced to legislative decision and design flaws in social safety provisions that have perilous healthcare impacts combined with the financial exhaustion of the National Social Security Fund NSSF by the depreciation of the national currency. 

It is not something that is caused by the hosting of Syrian refugees or can be remedied by the international agencies but only by the, decades overdue, structural and legal reforms that are the duty of the Lebanese state. 

From economic and social analysis of this problem, it needs to be added here that some of the most noteworthy impulses of reform in the healthcare system are attributable to the improvements in primary healthcare. And these improvements, which began with a wave of capacity building and expansion of primary healthcare centers (PHC) in the early 2010s are causally and operationally linked to the work of charities that initially responded to the needs of Syrian refugees. Consulted to high degrees by displaced Syrians until the late 2010s, today the PHC network is the go-to provider to Lebanese citizens of all backgrounds, serving their needs on daily basis and thereby paving a viable way towards better and more efficient healthcare. 

Finally, in financial terms, it has to be acknowledged that the payments of refugee medical bills and general subsidies to hospitals – from fuel for generators to donations of medical drugs and vaccines – by international agencies have added value to the Lebanese healthcare economy. In the economic crisis, agencies’ emergency financial support to hospitals “was a lifeline”,  as Freijsen mentions. 

Moreover, if even a very simple mental accounting of the economic impacts of payments for any medical procedures and care for refugees by UNHCR and other agencies is undertaken, it will be clear that this money behaved mostly agnostically (as money is want to do). It entered the pockets of Lebanese health workers, maintenance and administration staff, suppliers, and providers of external services from taxi drivers to PR consultants. Not leveraging the role and capacities of Lebanese hospitals in refugee medical care is, in economic sense, a missed opportunity. 

Education for return or stage setting for new troubles?

In education, controversies over schooling of Syrian children have erupted as far back as 2012 and 13. According to Carlos Naffah, education expert and author of a new book on the refugee crisis, the schooling dilemma developed over four phases. In the buildup of refugee numbers up until 2014, the Lebanese Ministry of Education and Higher Education neglected preparing for an increase in student numbers and the need to teach them the curricula and knowledge that would enable their life in Syria after an eventual return.  

Then, however, as decisions on teaching the Lebanese curriculum were taken against international advice, Naffah sees the system as moving from unpreparedness in the  first phase to inefficiency in the second between 2014 and 19. This was followed by pandemic-related non-performance in the third from 2020 to 23. As an example of the system’s weakness, he tells Executive that only 1 percent of the Syrian student generation entering the Lebanese school system in 2013 were able to meet 10th grade attendance requirements after 2019, in the third phase of the schooling drama.   

According to Naffah, UNICEF and international agencies paid $1.1 billion for education of refugee students but the funds were not deployed intelligently and were unable to build sustainable education pathways or instigate overdue systemic reforms.  More importantly, however, the opportunity was missed  for the Lebanese and for the Syrian stakeholders.  

Firstly, the imposition of the Lebanese curriculum was a contradiction to the declared intent of seeing young Syrians return to their country as quickly as possible. “If you are really respecting the right of return of refugees, you will do whatever you can to help them keep their identity. What we did was use the policy of integration [while] we are talking on television against integration,” he says.  

It was also an operational misjudgment that contributed to high seasonal dropout rates, extremely low educational attainment, and juvenile delinquency, he adds: “The result is that we have more frustrated Syrians who are not anymore Syrian by culture but were unable to become Lebanese by identity and political rights. I name them as lost generation and in my opinion are the ingredients of future crises.” 

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Thomas Schellen

Thomas Schellen is Executive's editor-at-large. He has been reporting on Middle Eastern business and economy for over 20 years. Send mail

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