JEDDAH, 19 January 2004 — Lebanese Prime Minister Rafik Hariri yesterday described how Lebanon had managed to rebuild its economy after years of civil war that cost billions of dollars in destroyed infrastructure, businesses, communities, homes and lives.
Hariri was the first guest speaker on Day 2 of the Jeddah Economic Forum. Whereas sessions on Day 1 focused on the economy and developments in the Kingdom, the theme yesterday widened out to include the Middle East and Asia.
“I come to you from Lebanon, which is a living example of the miracle of rebirth though many in the world community had written it off. When we took office in 1992, Lebanon was devastated — the infrastructure was destroyed, the military and security forces were almost nonexistent, tens of thousands had been displaced from their homes and immigration was draining Lebanon of its most valuable assets, its young and talented people.”
Hariri said the cost of reviving the country was going to be billions of dollars at a time when Lebanon was already in debt. The total public debt in 1992 was some $2.5 billion. The budget deficit was over 50 percent of total government expenditure and government revenue was less than $350 million.
“The Lebanese infrastructure is almost completely rehabilitated,” said Hariri. “All sectors are functioning at full capacity. Gross domestic product per capita increased from $820 in 1990 to more than $4,500 in 2003. Our money is stable and inflation has fallen from more then 120 percent in 1992 to approximately 2 percent at the end of 2003.”
According to Hariri, this had allowed Lebanon to attract substantial capital inflows and the country’s international reserves now stand at more than $12 billion as against less then $1 billion in 1992. Exports have also doubled and now amount to $1.5 billion. Lebanon’s banking system has also witnessed substantial growth. Total deposits in commercial banks increased from $6.5 billion in 1992 to $48.6 billion at the end of 2003.
Hariri’s broad-based strategy for economic recovery not only dealt with rebuilding the economy but also with rebuilding political and social institutions at the same time. He pointed out, however, that there were still issues to be resolved. “First of all, part of our country in the south is occupied. Second, we have public debt and budget deficits.”
Hariri stressed: “We need better relations among the political parties in the country. We have to see the problems all together and try to solve them all together because living together is essential for the Lebanese people. We cannot do it otherwise. Muslims and Christians have to live together and work together and the political parties have to understand that none of them can rule the country on their own and they have to agree to a political program that will save the economy and the future of the country.”
The most important lessons from the reconstruction of Lebanon, according to Hariri, has been “the gift of a normal life.”
Hariri also supported a call from the audience for an Arab common market, saying, “We have to destroy all obstacles to inter-Arab trade.”
