Donors pledge $160 million, Palestinian refugees need more

Residents of the besieged Palestinian camp of Yarmouk, lining up to receive food supplies, in Damascus, Syria. (AP)
Residents of the besieged Palestinian camp of Yarmouk, lining up to receive food supplies, in Damascus, Syria. (AP)
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Updated 25 June 2022

Donors pledge $160 million, Palestinian refugees need more

Residents of the besieged Palestinian camp of Yarmouk, lining up to receive food supplies, in Damascus, Syria. (AP)
  • UNRWA was established to provide education, health care, food and other services to the 700,000 Palestinians who fled or were forced from their homes during the war surrounding Israel’s establishment in 1948

UNITED NATIONS: Donors pledged about $160 million for the UN agency helping Palestinian refugees, but it still needs over $100 million to support education for more than half a million children and provide primary health care for close to 2 million people and emergency cash assistance to the poorest refugees, the agency’s chief said Friday.
Briefing reporters on the outcome of Thursday’s donor conference, Philippe Lazzarini said the pledges when turned into cash will enable the UN Relief and Works Agency known as UNRWA to run its operations through September. But “I do not know if we will get the necessary cash to allow us to pay the salaries after the month of September,” he said.
“We are in an early warning mode,” Lazzarini said. “Right now, I’m drawing the attention that we are in a danger zone and we have to avoid a situation where UNRWA is pushed to cross the tipping point, because if we cross the tipping point that means 28,000 teachers, health workers, nurses, doctors, engineers, cannot be paid.”
UNRWA was established to provide education, health care, food and other services to the 700,000 Palestinians who fled or were forced from their homes during the war surrounding Israel’s establishment in 1948.
There are now 5.7 million Palestinian refugees, including their children and grandchildren, who mostly live in camps that have been transformed into built-up but often impoverished residential areas in the Israeli-occupied West Bank, east Jerusalem and Gaza, as well as in Jordan, Syria and Lebanon. But UNRWA only helps the more than 500,000 in school and close to 2 million who have health benefits.
Lazzarini said the more than $100 million shortfall in funding for 2022 is about the same as the shortfall that UNRWA has faced every year for almost a decade, but while income has stagnated costs have increased.
In past years, UNRWA has been able to absorb the shortfall through austerity and cost control measures, he said, but today it’s not possible because there is very little left to cut without cutting services.
“Today, we have some classrooms with up to 50 kids,” the UNRWA commissioner-general said. “We have a double shift in our schools. We have doctors who cannot spend more than three minutes in medical consultation. So if we go beyond that, it will force the agency to cut services.”
Lazzarini said UNRWA’s problem is that “we are expected to provide government-like services to one of the most destitute communities in the region, but we are funded like an NGO because we depend completely on voluntary contributions.”
Funding the agency’s services has been put at risk today because of the “de-prioritization, or maybe increased indifference, or because of domestic politics,” he said.
Lazzarini said the solution to UNRWA’s chronic financial problem requires “political will” to match the support for the agency’s work on behalf of Palestinian refugees.
He said UNRWA has a very strong donor base in Europe and last year the Biden administration resumed funding which was cut by the Trump administration, but he said the overall contribution from the Arab world has dropped to less than 3 percent of the agency’s income.
Donors have also faced financial difficulties stemming from the COVID-19 pandemic, and now there’s a major effort to help Ukraine in its war with Russia, he said.
“We will know better at the end of the year how much it will impact the agency,” Lazzarini said.
Some donors have already warned UNRWA “that we might not have the traditional top-up at the end of the year, which would be dramatic” for the agency, he said.
Ahead of Thursday’s donors conference, Israel’s UN Ambassador Erdan Calls on countries to freeze contributions until all UNRWA teachers that it claims support terrorism and murdering Jews are fired.
Lazzarini said UNRWA received a letter from Israel’s UN Mission Friday which he hadn’t read, but he said all allegations will be investigated and if there is a breach of UN values and misconduct “we will take measures in line with UN policies.”


Was Lebanon the world’s biggest Ponzi scheme?

Was Lebanon the world’s biggest Ponzi scheme?
Updated 1 min 17 sec ago

Was Lebanon the world’s biggest Ponzi scheme?

Was Lebanon the world’s biggest Ponzi scheme?
  • A World Bank study accuses the political elite of making a “conscious effort” to weaken public-service delivery
  • Report finds use of excessive debt to create illusion of stability and reinforce confidence in the economy

DUBAI: A day before the second anniversary of the Aug. 4, 2020, Beirut port blast, the World Bank published a scathing report on Lebanon’s financial crisis and alleged acts of deception that appear to have made the country’s economic collapse inevitable.

Entitled “Ponzi Finance?,” the report compares the Mediterranean country’s economic model since 1993 to a Ponzi scheme — an investment fraud named after Italian swindler and con artist Carlo Ponzi.

During the 1920s, Ponzi promised investors a 50 percent return within a few months for what he claimed was an investment in international mail coupons. Ponzi then used the funds from new investors to pay fake “returns” to earlier investors.

The World Bank report claims a similar act of deception has taken place in Lebanon since the end of the civil war, whereby public finance has been used for the capture of the country’s resources, “serving the interests of an entrenched political economy, which instrumentalized state institutions using fiscal and economic tools.”

The report says excessive debt accumulation has been used to give the illusion of stability and to reinforce confidence in the economy so that commercial bank deposits keep flowing in. The study analyzes Lebanon’s “public finances over a long horizon to understand the roots of the fiscal profligacy and its eventual insolvency.”

At the same time, according to the report, there has been a “conscious effort” to weaken public-service delivery to benefit the very few at the expense of the Lebanese people. As a result, citizens end up paying double while receiving low-quality services.

The World Bank experts who wrote the report describe Lebanon’s financial crisis as “a deliberate depression” because “a significant portion of people’s savings in the form of deposits at commercial banks have been misused and misspent” over the past 30 years.

“It is important for the Lebanese people to realize that central features of the post-civil war economy — the economy of Lebanon’s Second Republic — are gone, never to return. It is also important for them to know that this has been deliberate.”

A protester stands with a Lebanese national flag during clashes with army and security forces near the Lebanese parliament headquarters in the centre of the capital Beirut on August 4, 2021, on the first anniversary of the blast that ravaged the port and the city. (AFP/File Photo)

The report adds: “These are earnings by expats who toil in foreign lands; they are retirement funds for citizens and perhaps the sole resource for a dignified living; they are necessary financing for essential medical and education services that consecutive governments have failed to provide; they are funds to pay for electricity in light of colossal failures in Electricite du Liban.”

Since 2019, Lebanon has been in the throes of its worst ever financial crisis, which has been compounded by the economic strain of the COVID-19 pandemic and the nation’s political paralysis.

In October 2019, the Lebanese took to the streets in the short-lived “thawra,” or revolution, demanding political and economic change. Their hopes were soon crushed by the trauma of the Beirut port blast, which on Aug. 4, 2020, killed 218 people, injured 7,000, and left 300,000 homeless.

These overlapping crises have sent thousands of young Lebanese abroad to search for security and opportunity, including many of the country’s top medical professionals and educators.

A World bank review of Lebanon's public finances has blamed an entrenched political elite for the economic collapse plaguing the country. (AFP)

Lebanese economists and financial analysts largely agree with the World Bank’s Ponzi scheme analogy.

“Lebanon is the greatest Ponzi scheme in economic history,” Nasser Saidi, a Lebanese politician and economist who served as minister of economy and industry and vice governor for the Lebanese central bank, told Arab News.

Unlike financial crises elsewhere in the world through history, Saidi said the cause of Lebanon’s woes could not be pinned to any single calamity that was outside the government’s control.

 

“In Lebanon’s case it was not due to an actual disaster, not due to a sharp drop in export prices in commodities, it is effectively man-made.

“The World Bank talks about Ponzi finance, and they are right to point to the fact that you have two deficits over several decades. One was a fiscal deficit brought on by continued spending by the government more than revenues.

“The problem was that the government’s spending did not go for productive purposes. It did not go for investment in infrastructure or to build up human capital. It went for current spending. So, you didn’t build up any real assets. You had a buildup of debt, but you didn’t build up assets in proportion or to compare to the borrowing that you had.”

Since the end of the civil war, Lebanon should have been undergoing a period of reconstruction. However, spending on such infrastructure projects remained low, with the money seemingly siphoned off elsewhere.

“The infrastructure that was required — electricity, water, waste management, transport, and airport restructuring — was neglected,” said Saidi.

A Lebanese activist displays mock banknotes called “Lollars” (top) for a 100 USD bill, in front of a fake ATM during a stunt to denounce the high-level corruption that wrecked the country in Beirut on May 13, 2022. (AFP)

But it was not just material infrastructure of this kind that was neglected. Institutions that would have improved and solidified governance, accountability, and inclusiveness were also ignored, leaving the system vulnerable to abuse.

“Whenever you go through a civil war, you need to think about the causes of the war, and much of it was due to dysfunctional politics, political fragmentation, and the break-up of state institutions,” said Saidi.

“There was no rebuilding of state institutions and because of that, budget deficits continued, and a very corrupt political class began owning the state. They went into state-owned enterprises and government-related enterprises and considered that all state assets are their possessions and instead of possessions of the state.”

Lebanon’s “Ponzi scheme” was also driven by current account deficits and the overvalued exchange rate caused by the central bank policy of maintaining fixed rates against the dollar.

In economics, said Saidi, this is what you called the “impossible trinity,” meaning that a state could not simultaneously have fixed exchange rates, free capital movements, and independence of monetary policy.

The portside blast of haphazardly stored ammonium nitrate, one of the biggest non-nuclear explosions ever, killed more than 200 people, wounded thousands more and decimated vast areas of the capital. (AFP/File Photo)

“If you peg your exchange rate, you no longer have any freedom of monetary policy. Lebanon’s central bank tried to defy the impossible trinity and tried to maintain an independent monetary policy at a time in which the exchange rate was becoming more and more over-valued.”

The Lebanese central bank increased borrowing in an attempt to protect the currency and, in 2015, bailed out the banking system, all the while insisting the system was sound and suppressing IMF reports claiming otherwise.

“The World Bank report states things that we have all been saying since the beginning of the crisis,” Adel Afiouni, Lebanon’s former minister for investments and technology, told Arab News.

“Of course, the crisis was predictable. The indicators were there for years. The debt to GDP level and the unsustainability of this debt to GDP level and the unsustainable deficit that kept growing, and the way (the central bank) has managed public finances in an irresponsible way was a red flag for years.

“Countries usually react in a responsible way by announcing a set of measures to control public finance to reduce the deficit and the debt. This did not happen in Lebanon. The current authorities have ignored basic principles of how to avoid a crisis pre-2019 and how to manage a crisis post-2019.”

In April 2022, Lebanon reached a draft funding deal with the IMF that would grant the equivalent of around $3 billion over a 46-month extended fund facility in exchange for a batch of economic reforms. However, in June, the Association of Banks in Lebanon called the IMF draft agreement “unlawful,” stalling the process.

“This is the first step that should have happened in the first few weeks of the crisis, not two and a half years later,” said Afiouni. “Yet we still need to see radical reforms before we see the funding, and there is no indication now that we are about to see serious implementation of those reforms.”

The World Bank report calls for a comprehensive program of macro-economic, financial, and sector reforms that prioritize governance, accountability, and inclusiveness. It says the earlier these reforms are initiated, the less painful the recovery will be for the Lebanese people. But it will not happen overnight.

“Even if the reforms and laws were passed, it will take time to recover and to restore trust,” said Saidi. “Trust in the banking system, in the state, and in the central bank has been destroyed. Until that trust is rebuilt, Lebanon will not be able to attract investment and it will not be able to attract aid from the rest of the world.”

And although Lebanon held elections in May, propelling several anti-corruption independents to parliament, Saidi doubted their influence would be enough to drive change.

“Some 13 new deputies entered parliament, but they are unlikely to make the changes that are required,” he said. “Politically, business continues as usual. There is a complete denial of reality.”


UN Security Council to meet over Gaza fighting

UN Security Council to meet over Gaza fighting
Updated 08 August 2022

UN Security Council to meet over Gaza fighting

UN Security Council to meet over Gaza fighting
  • Both sides have reserved the right to respond if the cease-fire is violated

USA: The UN Security Council was to hold an emergency meeting on Monday to discuss the situation in Gaza, where a truce is holding between Islamic Jihad militants and Israel after three days of deadly conflict.
China, which holds the presidency of the Security Council in August, announced the emergency meeting on Saturday, with Ambassador Zhang Jun expressing his concern over Gaza’s worst fighting since an 11-day war last year.
Ahead of the meeting, Israeli Ambassador to the UN Gilad Erdan called Monday for the council to place “full accountability” on Islamic Jihad, accusing the Iran-backed group of using Gazans as “human shields.
“There must be one outcome and one outcome only, to condemn the (Islamic Jihad) for its double war crimes while placing the full accountability ... for the murder of innocent Palestinians on the shoulder of the radical terror group,” he said at a press briefing.
“They fire rockets at Israeli civilians while using Gazans as human shields. This is a double war crime,” he said.
Israel had since Friday launched a heavy aerial and artillery bombardment of Islamic Jihad positions in Gaza, leading the militants to fire over a thousand rockets in retaliation, according to the Israeli army.
An Egypt-brokered cease-fire reached late Sunday ended the intense fighting that killed 44 people, including 15 children, and wounded 360 in the enclave according to Gaza’s health ministry.
Both sides have reserved the right to respond if the cease-fire is violated.
The Security Council’s consultations will take place on Monday afternoon in New York. No statement is expected after the meeting, several diplomatic sources have said.


Qatar Tourism launches program to upskill global travel partners

Qatar Tourism launches program to upskill global travel partners
Updated 08 August 2022

Qatar Tourism launches program to upskill global travel partners

Qatar Tourism launches program to upskill global travel partners
  • Focuses on various aspects of Qatar’s history, heritage, attractions, and experiences

DOHA: Qatar Tourism has launched a new interactive online training program to improve its global travel t partners’ knowledge of the country’s diverse offerings, and provide them with accredited qualifications, Qatar News Agency reported. 

The Qatar Specialist Program is part of Qatar’s comprehensive plan to transform the country into a world-class tourist destination. 

The program uses cutting-edge digital learning technologies to provide partners with the knowledge and tools they need to effectively promote and sell Qatar internationally.

“The Qatar Specialist Program is another step towards supporting the global travel trade industry in working alongside Qatar Tourism to help drive significant growth in annual international visitor arrivals and welcoming six million visitors a year by 2030,” Qatar Tourism’s International Markets chief Philip Dickinson said. 

The program focuses on various aspects of Qatar’s tourism industry, including history, heritage, attractions, and experiences. 

International partners who complete the entire course will be eligible for exclusive benefits such as insider tips, itineraries, and the most up-to-date information on accommodations and attractions.


EU submits ‘final text’ at Iran nuclear talks, Tehran examining document

EU submits ‘final text’ at Iran nuclear talks, Tehran examining document
Updated 08 August 2022

EU submits ‘final text’ at Iran nuclear talks, Tehran examining document

EU submits ‘final text’ at Iran nuclear talks, Tehran examining document
  • Talks aimed at reviving the agreement over Iran’s nuclear program resumed on Thursday in Vienna

VIENNA: The European Union submitted a “final text” at talks to salvage a 2015 deal aimed at reining in Iran’s nuclear ambitions and Tehran said Monday it was reviewing the proposals.
Britain, China, France, Germany, Iran and Russia, as well as the United States indirectly, resumed talks on Thursday in Vienna, months after they had stalled.
The European Union has submitted a “final text,” a European official said on Monday. “We worked for four days and today the text is on the table,” the official told reporters on condition of anonymity.
“The negotiation is finished, it’s the final text... and it will not be renegotiated.”
“Now the ball is in the court of the capitals and we will see what happens,” the European official added. “No one is staying in Vienna.”
The official said he hoped to see the “quality” text accepted “within weeks.”
Iran said it was examining the 25-page document.
“As soon as we received these ideas, we conveyed our initial response and considerations,” state news agency IRNA quoted an unnamed foreign ministry official as saying.
“But naturally, these items require a comprehensive review, and we will convey our additional views and considerations.”
On Sunday, Iran demanded the UN nuclear watchdog “completely” resolve questions over nuclear material at undeclared sites.
Iranian sources have suggested a key sticking point has been a probe by the International Atomic Energy Agency (IAEA) on traces of nuclear material found at undeclared Iranian sites.
“That has nothing to do with” the Joint Comprehensive Plan of Action (JCPOA) agreement of 2015, the European official said.
“I hope Iran and the IAEA will reach an agreement because that will facilitate a lot of things.”
The UN agency’s board of governors adopted a resolution in June, censuring Iran for failing to adequately explain the previous discovery of traces of enriched uranium at three previously undeclared sites.
“We believe that the agency should completely resolve the remaining safeguard issues from a technical route by distancing itself from irrelevant and unconstructive political issues, Iran’s foreign minister Hossein Amir-Abdollahian said on Sunday.
Kelsey Davenport, an expert at the Arms Control Association, warned against abandoning the IAEA probe in a bid to revive the JCPOA, which she called “the most effective way to verifiably block Iran’s pathways to nuclear weapons.”
If the United States and the other signatories to the 2015 deal do not support the UN body, it will “undermine the agency’s mandate” and broader non-proliferation goals, she wrote on Twitter.
The EU-coordinated negotiations to revive the JCPOA began in April 2021 before coming to a standstill in March.
The 2015 accord gave Iran sanctions relief in exchange for curbs on its atomic program to guarantee Tehran could not develop a nuclear weapon — something it has always denied wanting to do.
But the unilateral withdrawal of the United States from the deal under president Donald Trump in 2018 and the reimposition of biting economic sanctions prompted Iran to begin rolling back on its own commitments.


Jordan government reiterates support to Yemen truce

Jordan government reiterates support to Yemen truce
Updated 08 August 2022

Jordan government reiterates support to Yemen truce

Jordan government reiterates support to Yemen truce
  • Jordan’s foreign minister added that the country has received ‘7,000 Yemenis since the start of the armistice’

DUBAI: Jordan’s foreign minister Ayman Safadi said on Monday that Amman is ‘committed to continuing its support for Yemen and enhancing its stability.’

Safadi, who spoke in a joint press conference with his Yemeni counterpart, Ahmed Awad bin Mubarak, said Jordan supports the truce in Yemen and ‘roads to Taiz must be opened.’

“A comprehensive agreement must be reached in Yemen in accordance to the Gulf’s references and initiatives,” he said.

Jordan’s foreign minister added that the country has received ‘7,000 Yemenis since the start of the armistice.’

Also speaking at the conference, bin Mubarak accused the Iran-backed Houthis of not abiding by a key element in the UN-brokered truce to reopen roads to the besieged city of Taiz saying the group was “running away” from its commitments.

He said the Houthis ‘imposed’ the war on the country after the militia’s failed uprising, laying a siege on Taiz and its residents for seven years using ‘minefields’.

Bin Mubarak confirmed his government's support to expand the truce into a ‘comprehensive political agreement.’

He said all nations are ‘facing the Iranian project’, which chose Yemen as its station.

Meanwhile, Safadi condemned the recent attacks in the courtyards of Al-Aqsa Mosque during the meeting.

‘We are committed to the two-state solution,’ he said.

Bin Mubarak also announced an upcoming visit of Rashad Al-Alimi, the chairman of Yemen’s Presidential Leadership Council, to Jordan.