Lebanon is in need of close to $1 billion to finance urgent projects aimed at supporting host communities that are reeling under the increasing burden of around 1.6 million Syrian refugees, a senior Lebanese government representative told The Daily Star.
Shadi Karam, the representative of the government on the steering committee of a World Bank-supervised multi-donor trust fund (MDTF) for Lebanon, says he expects money to start flowing into the fund now that its work mechanism has been officially ratified by the Cabinet.
The Cabinet, which appointed Karam as its representative on the MDTF steering committee last April, officially ratified in mid-August the fund’s work mechanism. Three countries so far have made donations – Finland, Norway and France – that totaled 7 million euros ($10 million).
Karam, who has been following up on the issue of displaced Syrians in Lebanon since 2011 in his previous capacity as senior economic adviser to former President Michel Sleiman, says it would be difficult to predict the timeline of fundraising but expects it to gain pace in the near future.
“The timeline can be very difficult to predict. History and experience has taught us that fundraising goes by bouts. It goes up very quickly and then slows down due to donor fatigue before picking up again,” he says.
“We need close to $1 billion to start making a difference,” Karam adds. Following the end of Sleiman’s tenure in May of this year, Karam assumed the same duties alongside Prime Minister Tammam Salam and has continued to frequently meet diplomats in Beirut and abroad.
He says several donor countries have made pledges to help Lebanon restore economic stability and boost economic growth to pre-crisis levels. “I think now that the ball is rolling. It is hopefully going to snowball.”
Donor countries are more likely to commit funds to support Lebanon in 2015 as opposed to 2014, Karam says, since governments start appropriating budgets in September after the summer recess. “This is why we had everything ready before countries start with their budgeting exercise.”
A meeting of the International Support Group for Lebanon (ISGL) scheduled for Sept. 26 in New York will be crucial in terms of reiterating support for the Lebanese government in light of the recent game-changing events in Iraq, Karam adds, referring to the military gains made by ISIS.
The alarming situation in Iraq and Syria as a result of the threat posed by ISIS should help international and regional powers mitigate political complications and could lead to an opening that reflects positively on Lebanon, Karam explains.
“ Lebanon is convening under the same roof several parties that are in disagreement,” Karam says of the ISGL meeting that brings together permanent members of the U.N. Security Council, the European Union and the Arab League.
“In light of recent regional and local security developments, the international community needs to pump money quickly to support Lebanon,” Karam says, but stresses that the ISGL meeting shouldn’t be regarded as a fundraising event in itself, though it often serves as a support platform for future fundraising.
Almost a year has passed since ISGL’s first meeting in New York Sept. 25, 2013, that was followed by two conferences in Paris in March and in Rome in June.
The first meeting in New York paved the way for the establishment of the MDTF, Karam says.
During the meeting the World Bank submitted, upon the request of the Lebanese government, an assessment on the impact of the Syrian conflict on the Lebanese economy.
“A lot of the merit has to be given to the World Bank that produced nothing short of a small miracle because they came out with a remarkably well prepared document in a miraculously short period of two months. It would normally take six to nine months to produce such a document,” Karam says. “This document was instrumental to convince world powers that Lebanon needed massive and urgent help.”
The report said the Syrian crisis had depressed government revenue collection by some $1.5 billion while increasing state expenditures by $1.1 billion, with a total fiscal impact of $2.6 billion over three-year period from 2012 to 2014.
According to Karam, the World Bank’s assessment focused on the economic needs of the Lebanese host communities following efforts that were first directed to provide humanitarian aid for Syrian refugees.
Since then, Karam and his team, in cooperation with the Finance Ministry, have been adapting the road map that was adopted in 2013 to fit today’s changing environment and realities.
“We have reworked the previous road map to address urgent and necessary projects, mainly on the short- to medium-term projects because the host communities are under five times more pressure than they were in 2013,” Karam says.
The increased pressure on host communities is raising the possibility of social tensions between them and displaced Syrians, according to Karam, who says the government gave priority to immediately feasible projects.
“For example, if we had to choose between a project that requires the government to expropriate land and another that doesn’t, we favor the second. In other words, we are adopting an open-architecture arrangement in line with the vision of the government and urgent needs.”
The government has recently approved a major project aimed at helping 11 municipal federations across Lebanon invest in developmental projects ranging from water treatment, electricity distribution and education, among other services, Karam says.
The MDTF comprises a steering and a technical committee. The steering committee, which decides on broad strategic issues, includes the finance minister and Karam in his capacity as representative of the Lebanese government, along with delegates of the World Bank, the U.N. and donor countries, as well as other agencies.
The technical committee, which decides on the specifics of each project, includes, in addition to representatives of international groups, delegates from concerned Lebanese ministries.
Concerned ministries draft studies and submit them to the steering committee that decides on priority projects and refers them to the technical committee that determines the feasibility plan before submitting the plan for government approval along with the grant attached to it.
After approval, the project is referred back to the concerned ministry that receives the needed funds for its implementation from the Finance Ministry under close monitoring from the technical committee.
“The loop starts with the ministry and ends with the ministry. The process guarantees transparency, accountability and efficiency in implementation,” Karam explains, pointing out that regular reports are filed with the steering committee and donor countries on implementation phases.
In addition to supporting host communities, the government is also at an advanced stage in discussions regarding the establishment of camps for Syrian refugees in “the Lebanese part of the no-man’s land” along the Syrian-Lebanese border, Karam says.
Some 1.2 million Syrian refugees are officially registered with UNHCR in Lebanon, but government estimates put the total number at 1.6 million.
The trust fund will play no role in funding the establishment of camps, according to Karam, who says the government is seeking to secure funding to build the necessary infrastructure for some 5,000 to 10,000 housing units that could be later dismantled and relocated to Syria when refugees return home.
By Elias Sakr
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