BEIRUT, 16 May — An Australian, so they say, spent a week in Lebanon 30 years ago to study the country’s booming, parallel economy. His final address to the Beirut Chamber of Trade consisted of just two sentences. “Gentlemen,” he told the city fathers, “I have no idea what you are doing. But keep it up.” He wouldn’t say that today.
The country that was supposed to have risen from the ashes of civil war is now sliding into almost irrecoverable debt, an incredible 17 billion pounds sterling that is sucking away 43 percent of the country’s 4.78 billion pound budget every year. If the war destroyed Lebanon’s infrastructure, false hopes of regional peace crushed its rebirth.
And as Rafiq Hariri’s government tries to rescue 4.5 million pounds sterling a year with a 1 percent reduction in debt servicing, the most extraordinary stories of phenomenal waste and profligacy are coming to light.
Why on earth, for example, does Middle East Airlines — the country’s national carrier, MEA — need to have 4,200 employees for an airline which flies only nine leased Airbus aircraft; that’s 466 employees for each plane, two officials for every passenger? The national television station, Tele-Liban, was closed down in March — after transmitting through every day of the war — to slim its 403 staff down to 120. The country’s National News Agency, it turns out, paid monthly retainers to 40 reporters in just the small city if Baalbek.
But however hard Hariri struggles — and as a billionaire himself, he’s about the only man who can save Lebanon — the news just gets worse.
Lebanon’s previous government — a Hariri-hating administration that arrested (and then released) dozens of former officials for alleged corruption and then allowed the economy to stagnate — had blocked the sale of 39,000 square meters of land worth 28 million pounds. Now the government has to turn back the legislation — Hariri claimed on Friday this would take only “a few weeks” — and persuade foreign buyers to come back. And now, as if to chip away at what confidence is left, the Canadian company which invested in Lebanon’s attempt to rebuild its mail system wants to pull out of its contract because of low revenues. Again, the previous government is partly to blame, allowing rival courriers to operate against LibanPost, whose contract officially gave it a monpoly.
And there, of course, is the rub. Syria, which wants the return of the Israeli-occupied Syrian Golan Heights, doesn’t see why Israel should have a quiet time on its northern border with Lebanon. And with 21,000 Syrian troops in Lebanon, the Beirut government is in no position to object.
So will economic pressure force Lebanon to ignore Syria and send its soldiers south to protect America’s most important regional ally, Israel?
The Central Bank is insisting that there will be no devaluation of the Lebanese pound — which entered the war at 3 to the dollar in 1976 and came out 16 years later at 1,500 to the dollar — and Hariri is said to be ready to use every penny of the 4.7 billion pounds sterling apparently still held by the bank before allowing the Lebanese currency to slide again. For devaluation would mean poverty on a large scale, demonstrations and possible civil unrest. Who would be called upon to put down such discontent? Could the new, united Lebanese Army be counted on to confront its own people?
Back in 1975, Christian Lebanese soldiers shelled Sidon after a fisherman’s protest. Muslim soldiers refused to obey orders. That was how the civil war began.
