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Lebanon
Please note: All linked documents are in PDF format
| Objective |
SO Number |
FY 2004 |
FY 2005 |
FY 2006 |
| Economic Development | 268-001 |
18,794 |
23,220 |
22,000 |
| Promoting Democracy and Good Governance | 268-002 |
4,000 |
5,000 |
7,000 |
| Improved Environmental Policies and Practices | 268-005 |
12,400 |
7,000 |
6,000 |
|
Total (in thousands of dollars) |
35,194 |
35,220 |
35,000 |
|
The Development Challenge: Significant events took place in Lebanon last year that were considered to be major turning points for change in the political life of the country. The Municipal elections of May 2004 resulted in the formation of around 180 new Municipalities reflecting a stronger trend towards decentralization. The controversial extension of the President's term for an additional three years, and the formation of an unpopular government brought Lebanon's internal politics to the forefront of the international arena. The United Nations Security Council adopted resolution 1559, that advocates the full sovereignty of Lebanon and calls for the withdrawal of all foreign troops from Lebanese territory, and the disarmament and disbanding of all foreign and non-foreign militias operating in the country. Internally, as a reflection of discontent, a coalition of diversified factions and parties joined forces and formed the largest opposition block the country has witnessed since before the 1975-1990 civil war. These developments clearly show a strong domestic desire for change while maintaining the multifaceted image of Lebanon in the region. However, despite these encouraging developments, the divisiveness that is inherent in Lebanon's confessional system of government continues to contribute to neighboring Syria's ability to interfere in the political affairs of the country. As a result, Lebanon has kept its Syrian and Iranian-supported "resistance" alive, using the argument that the Israeli-occupied Shebaa Farms area is legally Lebanese, not Syrian territory.
The economic situation in Lebanon continues to worsen. Lebanon's accumulating public debt has reached $35 billion, which is equivalent to approximately 180% of gross domestic product (GDP), one of the highest ratios in the world. This is leading the government to dedicate around 70% of its public revenues to pay interests on the debt instead of financing public services. This has also resulted in widening disparities between the rich and the poor and an increased rate of unemployment (around 20%). The pace of economic and administrative reform is slow. The investment climate remains hazy, with decreasing investor confidence in the country's economy. Only Arab and Gulf financing account for a considerable portion of direct foreign investment in Lebanon. Slight improvements have been noted, with an increase of 29% in industrial exports and an improvement in the tourism sector. Lebanon surpassed the million tourists mark for the first time in 30 years, an increase of 33% in tourist arrivals and the highest average per tourist expenditures ($1,500) in the Middle East.
At another level, the environment in Lebanon is in a deteriorating state due to years of neglect. This, coupled with a lack of government investments in remedies has resulted in polluted air, soil, rivers, beaches, open dumping, and lack of control on industrial emissions. With USAID's help, attitudes and perspectives of environmental protection and preservation are slowly changing.
As a response to the challenges facing the country, the USAID program is contributing to the USG policy priorities of promoting democratic principles and free economies through investing in the people. It is helping the people of Lebanon by improving their standard of living, protecting their environment and health, building their local institutions, addressing their legal rights as citizens, and addressing their humanitarian needs.
USAID's key strengths reside in its flexibility and technical know-how. Over the years, USAID has built a reputation as one of the most active donors in Lebanon and is viewed by many as having one of the more responsive and targeted programs - though far from the largest. USAID attributes this to the following:
- Purpose of promoting equitable and sustainable development in Lebanon over the long-term;
- Products that are demand driven and focusing on the people;
- Highly skilled group of partners -NGOs, foundations, universities, business associations- capable of operating effectively at high governmental levels as well as at the community level;
- Procedures that demonstrate efficiency by channeling funding directly to implementing partners in contrast with other donors.
The USAID Program: The USAID program in Lebanon addresses the economic, political and environmental challenges prevalent in the country. USAID concentrates on improving living standards by revitalizing and expanding economic opportunities of small entrepreneurs and disadvantaged mine-affected people, encouraging trade and investment with World Trade Organization (WTO) accession, strengthening American educational institutions, and building the capacities of indigenous groups. USAID also aims to improve environmental policies and practices by developing appropriate waste management practices, creating environmental awareness, and promoting water sector restructuring and efficient water management. Finally, USAID emphasizes building democratic practices and encouraging good governance and transparent practices through strengthening municipalities all over Lebanon and providing assistance to civil society groups and advocacy programs. As a cross cutting theme, USAID works on cultivating citizen awareness of landmine affected areas and prevention practices. In addition, special emphasis is given to women's empowerment all across the activities. For instance, 41 landmine-affected women have benefited from USAID assistance and 21 rural women's production centers have been formed. Also, under the humanitarian assistance program, 60 poor and abandoned elderly women, 40 abused women, and 50 hearing impaired women have been supported this year.
Other Program Elements: The American Schools and Hospitals Abroad (ASHA) program provides an annual level of assistance to four American educational institutions in Lebanon, namely the American University of Beirut (AUB), the Lebanese American University (LAU), the American Community School (ACS) and the International College (IC). In FY 2004, ASHA's level of assistance amounted to $2,700,000. The funds are typically used to purchase commodities and equipment to improve the institutions' teaching capabilities, including classroom furniture, laboratory equipment, computers, and hardware and school books.
Lebanon benefits from the Leahy War Victims Fund for a number of mine action activities, chief of which is a "Resource Cooperative" aimed at creating economic opportunities for mine-injured survivors and their families in the Southern district of Jezzine, Lebanon's most heavily-mined and casualty afflicted area. As of this date, Leahy has allocated $3.1 million to the program in Jezzine.
Other Donors: Donor coordination in Lebanon was less active this year compared to previous years. The most recent Council for Development and Reconstruction report lists Arab countries as the main source of Lebanon's external funding, led by the Arab Fund for Economic and Social Development (AFESD) in infrastructure and capacity building; the Islamic Development Bank (IDB) in energy and infrastructure, the Kuwaiti Fund for Arab Economic Development (KFAED) in health, education, and energy; within the same category is funding from the International Bank for Reconstruction and Development (IBRD) of the World Bank in infrastructure, water, energy, and tourism; followed by the European Investment Bank (EIB) in transportation, the European Union (EU) in education, and capacity building; the Saudi Fund for Development (SFD) in education and transportation. France, Italy, Germany, Japan and the United Arab Emirates follow with capacity building and infrastructure projects. Most of the funding comes in the form of loans or soft loans that are channeled to the Council for Development and Reconstruction (CDR) and approved by the Council of Ministers contrary to the USAID assistance that is totally channeled to the NGO community in the form of grants or contracts. USAID assistance is among the top three donors in aggregate spending. USAID's main donor partners are the World Bank, the EU, the Italians and UNDP for rural development, agriculture and environment; the EU, the Italians and UNDP for administrative reform and municipal development; the EU for trade (Euro-Med and WTO agreements); and the French Development Agency for water resources management.
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