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Lebanon - Wanted : Politicians with vision

Lebanon needs leaders who can return the country to investors' radar screens


It has become common practice among ambitious Lebanese politicians to talk about the size of the public debt, high unemployment rates, corruption and the poor state of the economy a few days before parliamentary elections.

Politicians underline the need to create more jobs, reduce the budget deficit and increase foreign direct investment. They also agree corruption, theft and bureaucracy have contributed to the country's less-than-rosy economic situation.

But most of these politicians seem to be suffering from an acute and chronic disease called "I don't have the slightest idea how to get out of this mess."

Most observers and analysts attributed the reluctance of Beirut citizens to cast their votes in the ballots to the general political climate in the country.

The current election law may have angered many Lebanese, but one cannot exclude the fact that the absence of an economic plan may have added to the bitterness of the people.

Only the Lebanese National Bloc (LNB) and the Free Patriotic Movement (FPM), led by retired general Michel Aoun, presented comprehensive economic programs during their election campaigns.

The LNB called for privatizing state-owned assets and reducing government spending as a way to reduce the debt. It also emphasized the need to modernize the industrial sector by giving more incentives to industrialists, such as cutting the cost of fuel oil and electricity.

Aoun's FPM has only drawn up a partial economic plan. The main points the FPM advocates is a program of political reform to cut back on bureaucratic waste, and appoint international auditors to verify public spending figures for the past 15 years.

The private sector has long been demanding radical economic change in the country, encapsulated in a recent article by the president of the Lebanese Industrialists Association published in The Daily Star last week.

Fadi Abboud demanded that the local market be enlarged and the "Made in Lebanon" tag promoted internationally to boost exports. He added that the law that stipulates that Lebanese-made products have a preferential status of 15 percent over foreign competing products must be enforced.

Abboud also called for a complete revision of free-trade agreements with many Arab states.

But despite gestures by some political parties, the business community argues a good government is a government that intervenes less.

But there is a general feeling in the country that politicians will forget about their promises once they reach Parliament. And since the assassination of former Prime Minister Rafik Hariri in February, the country has been in a somber mood, many people feeling the country is on the edge of a very slippery slope.

According to the latest statistics, tourism activity fell by 18.5 percent in the first four months of 2004, port activity decreased by 1.7 percent and electricity production tumbled by 4.7 percent in the same period.

To make matters worse, bank deposits fell by $1.5 billion following Hariri's murder.

Hariri was considered the only business-minded politician who actually had a vision. Apart from the massive construction drive which he led since 1993; Hariri organized two conferences in Paris to raise soft loans to help reduce Lebanon's debt servicing.

This massive cash injection, along with the help of local commercial banks and the Central Bank, gave the country a breathing space.

But this short lived, upbeat mood was quickly dashed by the endless bickering between Hariri and President Emile Lahoud over economic reforms.

The new government that will emerge from the elections will have to move on Hariri's vision for Lebanon, and get past political squabbles.

Unconfirmed reports that the U.S. and some rich Arab oil countries may donate $2 billion to Lebanon if certain conditions are met, such as the disarmament of Hizbullah and Palestinian groups, would certainly help if these reports are true.

But an overall, comprehensive economic policy is what is desperately needed.

As one economist said recently about borrowing further money from the international community, "What we need now is Beirut one instead of Paris three and four. The government must cooperate with the private sector to overcome the problems and put Lebanon on the radar screens of investors."

Lebanon is at an important juncture for the first time since the Syrian troops pulled out. It can either choose the road of economic recovery by choosing the right people for the right jobs, or remain at the mercy of the old ruling political class that led to the $35 billion public debt.

Beirut,06 06 2005
Osama Habib
The Daily Star
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