Cri­sis econ­omy: The blame game

Le­banon must not hold Syr­ian refugees re­spon­si­ble for its eco­nomic woes

Executive Magazine - - Contents -

Le­banon’s two cur­rent crises will not evap­o­rate any­time soon. Our econ­omy is strug­gling and GDP growth rates are too low for the needs of an emerg­ing coun­try. Our cities and vil­lages are con­fronted by a refugee cri­sis of im­mense pro­por­tions. Nei­ther prob­lem will go away if we just close our eyes and both are re­lated in many ways, but the one cap­i­tal er­ror that we must erad­i­cate above all is to blindly blame one cri­sis on the other.

As the Syr­ian con­flict en­ters into its fourth year ev­i­dence of hu­man rights vi­o­la­tions com­mit­ted by all con­flict par­ties against civil­ians con­tinue to mount. The war has dis­placed more than 10 mil­lion Syr­i­ans, both in­side the coun­try and out, and left vast ar­eas of Syr­ian ter­ri­tory un­safe for refugees to re­turn. Re­luc­tantly, Le­banon has wel­comed 1.16 mil­lion Syr­i­ans seek­ing refuge into the coun­try, but the surge in pop­u­la­tion that the refugees rep­re­sent has strained re­la­tions.

The Le­banese gov­ern­ment has in­tro­duced poli­cies aimed at lim­it­ing the num­ber of refugees in Le­banon, and po­lit­i­cal sen­ti­ment has placed the brunt of the coun­try’s eco­nomic woes at the feet of the refugees. But blam­ing the refugees for Le­banon’s fal­ter­ing econ­omy demon­strates a fun­da­men­tal lack of un­der­stand­ing of this eco­nomic cri­sis and jeop­ar­dizes the coun­try’s abil­ity to so­licit donors for needed hu­man­i­tar­ian devel­op­ment aid.

The vast ma­jor­ity of refugees have no other choice but to stay in Le­banon for the fore­see­able fu­ture, and at­tempts to push them out of Le­banese ter­ri­tory through dis­crim­i­na­tory prac­tices, such as mu­nic­i­pal­i­ties im­pos­ing cur­fews for Syr­i­ans and the dereg­is­tra­tion of refugees, will help ad­dress nei­ther Le­banon’s im­me­di­ate needs for hu­man­i­tar­ian aid nor its long term need of re­vi­tal­iz­ing phys­i­cal and so­cial in­fra­struc­tures. Rather than con­tin­u­ing to blame refugees for the coun­try’s eco­nomic woes the Le­banese gov­ern­ment must re­main re­silient — its eco­nomic suc­cess de­pends on har­ness­ing Le­banon’s spirit and abil­ity of en­trepreneur­ship to iden­tify ways through this cri­sis.

It is clear al­ready that Le­banon has missed the huge eco­nomic op­por­tu­nity that at­tract­ing Syr­ian in­dus­tri­al­ists to the coun­try would have pro­duced. In­stead, many of Syria’s busi­ness­peo­ple have opted to restart their busi­nesses and fac­to­ries in the Gulf coun­tries or Egypt. This mir­rors Le­banon’s in­abil­ity to sup­port its own man­u­fac­tur­ers where un­re­li­able ac­cess to elec­tric­ity, the high cost of en­ergy, in­ef­fec­tive industrial zones, and tran­sit costs are among the con­tribut­ing bar­ri­ers to Le­banese fac­to­ries’ com­pet­i­tive­ness in re­gional and global mar­kets. But it has also re­flected upon the gov­ern­ment’s in­elas­tic­ity to quickly ad­dress this eco­nomic cri­sis.

As bad as Le­banon’s eco­nomic sit­u­a­tion now ap­pears there may still be op­por­tu­ni­ties to cap­i­tal­ize upon. On our streets one can see plenty of bud­get-size cars with Syr­ian li­cense plates, but also enough SUVs and luxury sedans to im­ply that Le­banon is host­ing Syr­ian pop­u­la­tion seg­ments that have some level of pur­chas­ing power. The hos­pi­tal­ity in­dus­try has re­al­ized that op­por­tu­nity — of­ten led by Le­banese busi­ness­peo­ple. More than a few res­tau­ra­teurs have found suc­cess in mar­ket­ing their es­tab­lish­ments to the large Syr­ian pop­u­la­tion able to af­ford a meal out.

The state still has chances to make good. At spe­cific lev­els, the re­duc­tion of bu­reau­cratic red tape can coax small gains for Le­banon’s in­dus­tries. Re­duc­ing bar­ri­ers to im­ports would help, for ex­am­ple, hos­pi­tals re­duce the time and cost of ac­quir­ing med­i­cal equip­ment not pro­duced in Le­banon. Even as the Le­banese gov­ern­ment re­mains re­strained by an im­posed po­lit­i­cal paral­y­sis, there is much more that its min­istries can do to fa­cil­i­tate trans­ac­tions in the coun­try’s econ­omy. In­stead of point­ing the fin­ger of blame at refugees, Le­banon’s politi­cians and gov­ern­ment lead­ers should be look­ing at ways to lever­age the cri­sis.

Rather than ab­hor­ring their pres­ence, Le­banon must ac­tively iden­tify the com­mu­ni­ties and projects that would con­trib­ute most to ad­dress­ing the needs of both refugees and their host com­mu­ni­ties — an ini­tial step in re­as­sur­ing donors of Le­banon’s wor­thi­ness as a coun­try to in­vest in. Le­banon’s lead­ers must also stump for those in­vest­ments to con­vince the in­ter­na­tional com­mu­nity to fi­nance in­fra­struc­ture prod­ucts that will im­me­di­ately al­le­vi­ate the suf­fer­ing of refugees, im­prove pro­vi­sion and qual­ity of in­fra­struc­ture ser­vices for all in­hab­i­tants in the short and mid term, and spur eco­nomic growth in the long term.

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