DEEP POCKETS
Lebanon has a crucial role to play in the care of Syria's huge refugee community and is working together with the international community to ensure the finances are in place.
It has been five years since the exodus of Syrian refugees to neighboring nations began. As of August 2016, the United Nations High Commissioner for Refugees (UNHCR) counted 4,815,540 people registered as refugees, distributed mainly among Egypt, Iraq, Jordan, Lebanon, and Turkey. With the effects of the refugee crisis drilling deep into the socioeconomic threads of recipient nations, the fourth International Donors Conference took place in February in London to pledge assistance in alleviating the upshots of five years of civil war in Syria.
After three previous donor conferences held in Kuwait generated USD7.7 billion in assistance, leaders and diplomats from 70 countries gathered in the British capital to further contribute to a global commitment that reached over USD12 billion in pledges, half of which will be distributed in 2016 and the other half from 2017-2020. During the conference, which was sponsored by the UK, Kuwait, Germany, Norway, and the UN, the Lebanese government presented its stabilization plan aiming to mitigate the effects the Syrian refugee crisis had caused on the tiny nation.
The delegation, headed by Prime Minister Tammam Salam, introduced the Lebanon Crisis Response Plan (LCRP), which brings together local and international partners to reinforce humanitarian and stabilization strategies to strengthen Lebanon's position in the crisis. According to the World Bank, the refugee crisis has represented a burden for the Lebanese state of USD13 billion since 2012, with 2015 costing as much as USD5.6 billion, equal to 11% of the country's GDP. It is important to recall that Lebanon holds the most refugees per capita, with some estimates placing the number at a fourth to over a third of the population.
The LCRP entails a five-year program with two major fields of action: education and economic opportunities, and job creation. First, through the Reaching All Children with Education (RACE) initiative, Lebanon has committed to enroll all school-aged refugee children (three to 18 years) in an educational program by the end of 2020. So far, 200,000 Syrian children have been incorporated into public school for the 2015/16 school year. The launching of RACE II has been composed of six core objectives to fulfill over the following five years: construct, rehabilitate, and equip all schools; expand the access to education through regulated non-formal education; integrate youth aged 15-24 into vocational and technical training; improve the quality and inclusiveness of teaching and learning; and strengthen the national education system. To reach this commitment, however, Lebanon requires contributions of USD350 million per year along the five-year duration of the program.
The second pillar of the LCRP focuses on integrating Syrian refugees into the labor market without damaging the already affected local job market. Facing an unemployment ratio of 20%, and up to 30% for youth unemployment, Lebanon's labor market has been smothered by the influx of refugees competing for unskilled jobs. The economic opportunities and job creation part of LCRP seeks to stimulate the economy through investments and sustainable growth to trigger business expansion across the country. The plan expects the creation of 300,000-350,000 jobs, of which Syrian refugees will occupy 60%. The second part of this plan pledges a five-year investment of USD1 billion for the Subsidized Temporary Employment Program (STEP), which will go to the municipalities to finance employment incentives and encourage SMEs to expand production and create new permanent jobs. The plan also contemplates a conjoint project with the World Bank and the European Union to guarantee market access to Lebanese products and strengthen value chains among Lebanese exporters.
A month after the London conference UN Secretary General Ban Ki-moon and World Bank President Jim Yong Kim paid a visit to Lebanon to reinforce their support to the nation and called on the international community to not abandon the millions of refugees in need of assistance. The pledges to further increase assistance to Lebanon were again heard during the World Humanitarian Summit in Istanbul in May 2016. Both the UN Secretary General and Prime Minister Salam mentioned the importance of maintaining the stability of Lebanon, along with monetary and physical aid to face the greatest humanitarian crisis of the 21st century.
DEEP POCKETS
TABLE OF CONTENTS
Focus: Lebanese-French Relations
Let’s be Franc
Lebanon shares a close relationship with its former colonizer, both in terms of economic relations and cultural identity among Lebanese. In spite of hardships like the presidential power vacuum and Syrian war next door, the bond is only getting stronger.
read articleFocus: Tripoli Economic Free Zone
The Tripoli Transformation
The Tripoli Special Economic Zone (TSEZ) is one of most ambitious projects in Lebanon at the moment. With an initial cost of USD27 million, it is meant to provide an alternative to the heavily centralized economic activity in Beirut, a new gateway for investments and trade to settle in northern Lebanon, and will transform the image of a long-neglected region.
read articleInterview
Dr. Freddie Baz, Vice Chairman & Group Strategy Director, Bank Audi
TBY talks to Dr. Freddie Baz, Vice Chairman & Group Strategy Director of Bank Audi, on the bank's increase in profits, dealing with currency devaluation, and working to turn the economy into an export-driven one.
read articleReview: Insurance
Life is a Rollercoaster
Unlike many emerging markets, Lebanon enjoys a relatively high insurance penetration rate and strong life segment, buoyed by compulsory lines and bancassurance. Competition remains fierce, however, and reform aimed at encouraging consolidation looks far off.
read articleInterview
Max R. Zaccar, Chairman of Commercial Insurance & President of the Association, Insurance Companies
TBY talks to Max R. Zaccar, Chairman of Commercial Insurance & President of the Association of Insurance Companies, on the resilience of the sector, increasing the already-high penetration rates in the country, and remaining one of the strongest insurance companies in the region.
read articleInterview
HE Arthur Nazarian, Minister, Energy and Water Resources
TBY talks to HE Arthur Nazarian, Minister of Energy and Water Resources, on the potential offshoots from oil and gas explorations, the country's National Energy Efficiency Action Plan, and attempts to increase renewable energy consumption.
read articleInterview
Wissam Zahabi, Chairman, Board of the Lebanese Petroleum Administration (LPA),
TBY talks to Wissam Zahabi, Chairman of the Board of the Lebanese Petroleum Administration (LPA), on making the investment climate attractive for foreign companies and becoming self-sufficient in energy.
read articleFocus: Sovereign Wealth Funds
Gas Pipe Dreams
Despite excitement over exploration of Lebanon's hydrocarbons, the creation of a sovereign wealth fund, which was included in legislation, has yet to take place. The country faces several obstacles in its path to creating and properly managing a fund.
read articleInterview
Pierre El Khoury, General Director, Lebanese Center for Energy Conservation (LCEC)
TBY talks to Pierre El Khoury, General Director of the Lebanese Center for Energy Conservation (LCEC), on the development of energy efficiency in Lebanon, awareness of energy conservation, and the country's 2020 renewable energy goals.
read articleInterview
Dr. Fady Gemayel, President, Association of Lebanese Industrialists (ALI)
TBY talks to Dr. Fady Gemayel, President of the Association of Lebanese Industrialists (ALI), on the group's work to promote industrialists, new developments in terms of industrial cities, and the future of industry in the country.
read articleFocus: Industrial Cities
Industrial Solution
Domestic and regional events have stifled Lebanon in building a strong national industry to protect and sustain its economy. Four proposed industrial zones throughout the country may provide it with the economic backbone it so desperately needs.
read articleInterview
Marianne Hoayek, Director of the Executive Office, Banque du Liban
TBY talks to Marianne Hoayek, Director of the Executive Office of Banque du Liban, on the roots of the Circular 331 concept, bridging funding gaps throughout the startup lifecycle, and the country's growing knowledge economy.
read articleRoundtable
Thinking It Through
On June 12, TBY and the American-Lebanese Chamber of Commerce (AmCham) organized a roundtable titled “Startup ecosystem sustainability: fostering cooperation to drive entrepreneurship." The participants discussed the impact of Circular 331, an initiative by Bank du Liban, the Lebanese central bank, to inject a potential of USD400 million into the local enterprise market and guarantee 75% of banks' investments in startups and startup support.
read articleFocus: Infrastructure for the startup ecosystem
The New Star
Startups are ubiquitous in Lebanon despite the difficulty of starting a business and the lack of services available to new businesses. However, a number of actors, both public and private, are innovating the environment and allowing startups to fulfill a greater role in the country's economy.
read articleFocus: Maritime Exports Bridge
Bridging The Gap
The conflict in Syria has wrought serious damage on the Lebanese economy, effectively closing off the country's trade routes through Syria. However, a new program geared at balancing the price disparities between land and sea transit is poised to help Lebanese industries.
read articleFocus: Real Estate
A Stimulus For The Rest Of Us
The real estate market in Lebanon is nothing like it used to be. The sector has slowed considerably, and demand has shifted from the traditional center, Beirut. However, stimulus packages from the central bank over the years have proven beneficial for all parties involved.
read articleInterview
Armand Pahrés, President, Lebanese Pharmaceutical Importers Association (LPIA)
TBY talks to Armand Pahrés, President of the Lebanese Pharmaceutical Importers Association (LPIA), on the development of legislation in the sector, boosting further innovation, and opportunities for Lebanon to become more self-sufficient in pharmaceuticals.
read articleFocus: Incentives for pharmaceuticals in Lebanon
Pharma Land
Lebanon has always been the region's leader in all things health related. Its pharmaceutical industry is no exception, and the country's incentives for international pharma companies to operate, manufacture, and distribute in Lebanon are only getting stronger.
read articleInterview
HE Elias Bou Saab, Minister, Education and Higher Education
TBY talks to HE Elias Bou Saab, Minister of Education and Higher Education, on the ministry's initiatives to improve the education system, ensuring access to education for Syrian refugee children, and reversing the brain drain in the country.
read articleInterview
Mohamed Harajli, Provost, American University of Beirut (AUB)
TBY talks to Mohamed Harajli, Provost of the American University of Beirut (AUB), on his upcoming plans for the university, the key role played by the AUB alumni, and fostering an entrepreneurial spirit among students.
read articleFocus: Programs to school Syrian refugee children
High Marks
Proportional to its population, Lebanon has taken in significantly more Syrian refugees than any other country. With the country now facing the problem of placing the tens of thousands of Syrian children in school, international donors and local and foreign organizations are making educational support a priority.
read articleInterview
Joseph G. Jabbra, President, Lebanese American University (LAU)
TBY talks to Joseph G. Jabbra, President of the Lebanese American University (LAU), on embracing technology at the university, the challenges of Lebanon's brain drain, and the importance of having international links with other institutions.
read article