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Lebanon
>> Regional Overview >> Lebanon Overview
Summary Tables
Program Summary
Previous Years' Activities
2001, 2000, 1999, 1998, 1997Last updated: 53
Introduction
In 2000, the withdrawal of Israeli forces from South Lebanon and the election of a reform-minded government gave Lebanon the opportunity to rebuild and redefine itself-as a country, a nation, and a partner in regional peace and global prosperity. It is important to the United States that Lebanon progress as a stable, secure, responsible, and prosperous partner-one that supports a market-driven economy, a democratic society, and a sustainable environment. It is also vital that Lebanon play an active role in achieving a comprehensive peace in the Middle East. USAID assistance is well positioned to contribute to these goals. While the current strategy is valid through 2002, new developments warrant a review and possible revision by the end of 2001.
Development Challenge
Lebanon is in a precarious but exciting position-courting opportunities that could fuse the country into a regional economic hub, but carrying constraints that could hold it back and provoke economic, if not political, crisis. The upside reflects a country that has regained its borders and elected a national government that, for the first time, has started to enact bold, rational structural measures designed to encourage growth and investment, streamline a bloated bureaucracy, and eliminate public waste. The international donor community supports these changes and is poised to assist further reform and reconstruction efforts. Municipal elections, held in 1998 for the first time in 35 years, have already produced some dynamic local governments that are becoming elements of positive change. On the environmental front, while water and air pollution are major problems, and water management a significant challenge, environmental protection and reforestation are gaining ground. This situation is bolstered by Lebanon's educated and talented workforce-the strongest in the region, as witnessed by the demand for and presence of Lebanese professionals throughout the region and beyond.
The downside reflects a complex web of historic and economic factors that have prevented many of Lebanon's 3.5 million people from rebuilding their lives. While the devastating 15-year civil war ended in 1991, the scars of religious, regional, feudal, political, and cultural differences remain imbedded in everyday life-dampening nation-building and collective action for the common good. Syria's continued presence, marked by some 35,000 troops, affects all major governmental decisions, as well as Lebanon's sovereignty. One consequence is that the Lebanese-Israeli border remains contested and at times unstable, slowing critical demining and resettlement efforts and mandating the continued presence of some 5,000 United Nations forces. There are also about 200,000 Palestinian refugees living in UN-administered camps. Economically, Lebanon is saddled with a soaring public debt, now at $24 billion or 140% of Gross Domestic Product. Sovereign credit ratings are down; debt-servicing and other expenditures have curtailed substantial public investment. Most private investors are in a wait-and-see mode. The middle class continues to shrink; per capita income has fallen below $5,000 and is increasingly skewed by disparities in income distribution. For many Lebanese, remittances and emigration are the lifelines or safety nets of what many see as a no-growth economy with limited opportunities.
USAID's strategy is to capitalize on the country's opportunities and chip away at the constraints wherever possible. For the past four years, USAID's primary focus has been revitalizing and expanding economic opportunities in Lebanon's most deprived and devastated rural areas through a private voluntary organization-led, community-based Rural Community Development Cluster (RCDC) program. By year's end, USAID will have helped some 430 villages and 850,000 people nationwide-about a fifth of Lebanon-to improve their lives through small-scale infrastructure, income generation, and environmental activities. This program is the largest and most active of any donor activity in South Lebanon; it is also the model for two $60 million World Bank and European Union projects due to come on-line this year. USAID is also supporting Lebanon's accession to the World Trade Organization (WTO) and developing strategies for the agro-industry, tourism, and service sectors. Lebanon's WTO foreign trade regime, to be negotiated this fall, will be the catalyst for several economic policy, legal, and regulatory reforms.
USAID is also promoting democratic governance in Lebanon through support to local municipalities, Parliament and regulatory boards. Eighty-two municipalities now have modern management information systems that track fiscal and budgetary matters, resulting in the collection of several million dollars of delinquent taxes. The ministries overseeing this program, Interior/Municipalities and Administrative Development, are looking to USAID for technical leadership to expand these systems nationwide. Support from USAID's Office of Transition Initiatives has been instrumental in helping stem corruption in larger urban municipalities while creating broad-based awareness of abuse and fraud through effective media campaigns and investigative journalism training.
USAID's environmental activities, many of which are linked to rural clusters, have pioneered low-cost, appropriate, innovative solutions to solid waste disposal and wastewater treatment that are now being disseminated in remote areas. Assistance from the Leahy War Victims Fund has enabled USAID to be the lead donor in humanitarian demining efforts, particularly in mine awareness and landmine victims' assistance. The focus is on Jezzine, the first area of Israeli/Southern Lebanese Army troop withdrawal. Also, given the domestic and regional (Lebanon-Jordan-Israel) sensitivities associated with water, ANE's regional Fostering Resolution of Water Resource Disputes activity is playing an increasingly important role in developing approaches for integrated water management.
Other Donors
While U.S. assistance is only 7% of donor disbursements, commitments at the 1996 Friends of Lebanon Conference have enabled USAID to assume an active role in donor coordination. USAID's focus on rural community development-until recently not covered by other donors-has given USAID access to key decision-makers and a role in filling gaps in the overall donor effort. The largest amounts of assistance come from multilateral sources for reconstruction of urban infrastructure, with the World Bank and European Union each accounting for approximately 18% of donor resources. Bilateral assistance accounts for 55% of aid flows; it is more varied, but also tilts toward urban infrastructure, trade financing, and education. In 1999, Kuwait was the largest bilateral donor, followed by Saudi Arabia and France. The latest report of the United Nations Development Program shows cumulative available financing at $4.1 billion. This was expected to increase to $5 billion in 2000, largely based on commitments for infrastructure and demining in Southern Lebanon.
FY 2002 Program
While this year's strategy review may yield some program adjustments for the next few years, USAID activities in FY 2002 will continue to support agency goals of promoting economic growth, building democracy, protecting the environment, and building human capacity. Steady funding levels will enable USAID to continue broadening and deepening coverage in these priority areas. Southern Lebanon will be a primary focus, recognizing that the nationwide expansion of cluster, municipal, and environmental activities must be balanced and targeted toward the most critically affected areas. Greater attention will be given to value-added activities in the agro-industrial sector, anti-corruption efforts among advocacy groups, water management and riparian issues in the south, strategic partnerships with other donors, and the institutionalization of management systems and processes among USAID's key partners. USAID will also maximize "internet for development" activities across the portfolio, looking to the private sector and American educational institutions for leadership. Assuming that WTO accession will be on track for early 2003, USAID will begin focusing on the enabling legislation and mechanisms needed to implement new policies and regulations in both productive and service sectors.
In addition to the bilateral program, a USAID Bureau for Humanitarian Response program demonstrates U.S. educational and medical technologies and practices through six different activities in Lebanon.
Activity Data Sheets
- 268-001 Reconstruction and Expanded Economic Opportunity
- 268-002 Increased Effectiveness of Selected Institutions That Support Democracy
- 268-005 Improved Environmental Practices
Country Background Information Resources
CIA Factbook
Library of CongressNational Geographic Country Maps
State Dept. Country Information
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Last Updated on: May 29, 2002 |
