Lebanon: Between a political rock and an economic hard place

Lebanon’s politicians appear powerless to address the faltering economy and its downward spiral brought on by the Syrian conflict. (Getty Images)
Updated 31 May 2019

Lebanon: Between a political rock and an economic hard place

  • Hariri heads into the fall all but powerless to address the economic decline
  • Attempts to form a government have been deadlocked since Hezbollah and its allies have secured a cabinet majority

DUBAI: Four months after Lebanon’s general election, any hopes Prime Minister-elect Saad Al-Hariri held of easing his way into office have been dashed following warnings of a crippling political stalemate in government and claims the country is facing economic collapse.
With a cabinet yet to be formed, Hariri heads into the fall all but powerless to address the economic decline — a situation some observers have described as a “vicious circle.”
This summer, Moody’s, the global rating agency, gave Lebanon’s economy a “Low (+)” grading due to “the deterioration in the regional economic and political environment.”
An article in The Economist magazine late last week was even more downbeat, saying Lebanon’s economy was on the brink of collapse.
“Since 2011, the lack of investment in infrastructure and the absence of economic reforms have weakened the country’s competitiveness, and would likely prevent Lebanon from returning to previously high real GDP growth, even if political risks were to subside,” the Moody’s report said.
While reports suggested the economy is facing a full-blown crisis, government officials believe that the country is not there yet.
“We’re passing through challenging times,” former Lebanese minster of finance Raya Al-Hassan told Arab News. “We’re in a huge slump. All the economic indicators point to a downturn in economic activity. All the real economy sectors are suffering and witnessing a downturn.
“We are in some sort of a recession. A lot of these sectors are not growing; growth is not registering beyond 2 percent annually, and if this situation persists, it will create a vicious circle that will be hard to break,” she said.
Political instability and sectarian strife have plagued Lebanon for years, with a decades-long civil war and the assassination of several of its leaders, including Hariri’s father, Rafic Hariri.
Recently, attempts to form a government have been deadlocked since Hezbollah and its political allies have secured a cabinet majority of more than 70 of the 128 seats during this year’s parliamentary elections at the expense of Hariri’s Future Movement.
Currently, there are 30 ministerial positions that are split equally among Christians and Muslims at 15 each, with further splitting among sects within these two main religions. And with no clear criteria on how these ministries will be allocated, the stalemate between political parties and representatives over the allocation of power could well continue until the end of the year.
“It’s an internal problem that has to do with holding power … in principle they (political parties) are asking for such power because they think they deserve it after they did well in the elections, but this is not the real reason,” political analyst Amine Ammouriyye said.
Ammouriyye believes the main factor “is the decision from outside Lebanon. For example, Hezbollah, who won the elections, now has the chance to opt for better relations with Syria and is among those asking for more formal relations than before,” he said.
“Internally, it’s all about power and, externally, it’s about the negotiation with Syria,” he said.
With politicians and foreign powers unable to put their agendas aside, Lebanon’s economy continues to falter, a downward spiral that was brought on by the outbreak of the Syrian conflict in 2011. Economic growth plummeted from a solid 9 percent at the time and has hovered around 1.1 percent for the past three years. Public debt stands at $82 billion, equivalent to 150 percent of gross domestic product, the third-highest world-wide after Japan and Greece.
At the Economic Conference for Development through Reforms with the Private Sector (CEDRE) in Paris in the spring, international donors pledged $11 billion to boost the economy, with a focus on improving Lebanon’s ailing infrastructure. In exchange, Lebanon promised reforms, including tougher measures to fight corruption and reduce budget deficits.
“The lifeline presented to us is a real opportunity to come out of this slump,” Al-Hassan said.
But if the government is formed and the reforms are not taken, it will be “harder and harder for the Lebanese economy to come out of the dire situation it is in now.
“This will result in huge unemployment if we don’t address it as soon as possible,” the former minister said.
“We are reaching a new milestone,” she said.


What shapes the Middle East’s migration patterns

Updated 26 min 7 sec ago

What shapes the Middle East’s migration patterns

  • An estimated 29 million people have migrated from Arab countries since 1990, according to UN data
  • Political crises and civil conflicts have blurred the lines between voluntary and forced migration

ABU DHABI: Less than two months since an unhappy year for the Arab region’s migrants and refugees came to an end, the omens of things to come are far from good.

According to the latest “Situation Report on Migration in the Arab Region,” prepared by the International Organization for Migration (IOM) in collaboration with various UN agencies, displacement and migration are two prominent trends at the beginning of 2020. Particularly — and unsurprisingly — in countries withongoing wars.

An overwhelming majority of Arab countries endorsed the Global Compact for Migration (GCM) at the UN General Assembly in December 2018, voting to adopt its principles in national legislatures.

Subsequently, the number of migrants and refugees crossing the Mediterranean Sea was found to have plunged in 2018 to almost a tenth of what it was in 2015.

However, the reality of the region’s migrant and refugee situa- tion belies the hopes raised by the adoption of the GCM.

In Libya, for example, there was a steep deterioration last year in the living conditions of migrants and refugees stranded in the unstable North African country.

FASTFACTS

29m - An estimated 29 million people have migrated from Arab countries since 1990.

1/2 - Almost half of the people who migrated stayed within the Arab region.

9.1m - Refugees who have sought protection in the Arab region include 3.7 million under the mandate of the UN Refugee Agency and 5.4 million registered with UNRWA.

14.5% - The number of migrant workers in 18 Arab countries stood at 23.8 million in 2017, representing 14.5 percent of all migrant workers globally.

?The country’s protracted civil conflict has not only caused massive displacement within its borders, but also means it has become a dangerous place for economic migrants from sub-Saharan Africa wishing to travel to Europe. World leaders have just pledged in Berlin not to interfere in Libya’s civil conflict and to uphold a UN arms embargo, but only time will tell if that promise will be honored.

In Syria, meanwhile, the human- itarian situation in Idlib — the last stronghold of opposition forces and a safe haven for millions of internally displaced persons (IDP) — remains shaky as Russian- backed regime forces press on, despite mounting civilian casualties.

In Yemen, a peace opportunity was missed in early 2019, and there has been no let-up since in the fighting between government forces and the Houthi militia, who control the capital Sanaa and the northern highlands. The country currently hosts between 2 million and 3.5 million IDPs and another 1.28 million returnees, in addition to 279,000 migrants and refugees — almost exclusively from Somalia and Ethiopia — for whom the country is a short-term way station, not a final destination.

Lebanon is in the grip of a wide- ranging crisis, too. People at the bottom of the economic ladder, including 1.5 million Syrian refugees and almost 500,000

Palestinian refugees, supple- ment their meager incomes with handouts from aid agencies. Even before the protests erupted in Lebanon in October last year, a UN vulnerability assessment report for refugees in the country, carried out in early 2019, made grim reading.

It said about 73 percent of Syrian refugees in Lebanon were living below the poverty line — up from 69 percent the year before, and considerably higher than the estimated 28 percent of Lebanese in the same situation.

Of course, migration and displacement have long shaped the Arab region, with countries simultaneously acting as points of origin, transit and destination.

However, in recent years, the distinction between voluntary and forced migration has become blurred as political crises and civil conflicts — viewed as the chief causes of human displace- ment — have proliferated. “The challenge today is to put in place policies that will ensure successful and true integration while benefiting both the countries of residence and origin,” Laura Petrache, a senior adviser at Migrant Integration Lab, told Arab News.

According to UN reports, the number of migrants and refugees originating from the Arab region reached 29 million in 2017. Almost half of them remained in the region. Overall, the number of migrants and refugees as a propor- tion of the total population of the Arab region has risen steadily over the past three decades.

In 2018, around 80 percent of the region’s refugees originated in the Levant, mostly on account of the Syrian conflict.

Caption

 

Jordan, Lebanon, Libya, Syria and Sudan are among the top 10 Arab destinations for migrants and IDPs owing to conflicts in the neighborhood. Apart from Lebanon, all of those countries have witnessed an increase in the number of refugees and migrants within their borders since 2015.

After Turkey, Jordan was the second-most-popular destination country for refugees and migrants from the region, with Lebanon, 

Saudi Arabia and the UAE also reporting significant numbers. Iraq was the only country that saw its national refugee and migrant population decrease.

What the latest reports confirm is that migration in the Arab world not only has multiple drivers — socio-economic pressures, political instability and environmental degradation — but also complex patterns and trends.

Take the Gulf and the Levant regions. They attract different kinds of migrants because their levels of stability, security and development are not comparable. While Libya, Syria, Lebanon and Yemen are plagued by conflict, violence, corruption and divisions in both society and polity, GCC member countries are leading the way in groundbreaking ideas and investments, building cities of the future and attracting talent from across the world.

The migrant population in the GCC countries swelled from 8.2 million in 1990 to 28.1 million in 2017 — a substantial rise compared with figures for other parts of the Arab region.

Around 27 percent of global remittance outflows in 2017 reportedly came from the Arab region, estimated at $120.6 billion, and almost all of that (98.9 percent or $119.3 billion) came from GCC countries. According to the IOM’s report, the top remittance-sending countries were the UAE (at $44.3 billion) and Saudi Arabia (at $36.1 billion).

Under the circumstances, it is difficult to see meaningful, positive change for migrants happening any time soon in the Arab region, with the possible exception of the GCC.

“Migration policy making should move away from assimila- tionist frameworks,” Petrache, of the Migrant Integration Lab, told Arab News. “Instead, the policy emphasis should be on working with countries of origin to achieve sustainable integration — and re-integration in the case of return immigration.

“The policies should take into consideration the potential for win-win solutions using and developing the capability of the migrants to make a positive contri- bution to local host communities,” Petrache said.