Syrian effect

The civil war in Syria is causing a severe refugee crisis in the region, including in Lebanon. Financial assistance is imperative, but there is no substitute for a political solution in Syria itself.

The Lebanese government estimates that the number of Syrian refugees in the country is now 1.5 million. Here, refugees begging on the steps of a bank in a street in Beirut on September 18.

AT THE MARGINS OF THE UNITED Nations General Assembly meeting, the U.N. Secretary-General hosted the inaugural meeting of the International Support Group for Lebanon. The session, held in New York, was attended by the five permanent members of the Security Council, representatives from the European Union and the Arab League, and the heads of significant U.N. specialised agencies—for refugees, for development and the two agencies for Lebanon itself: the U.N. Special Coordinator for Lebanon and the Force Commander for the U.N. Interim Force in Lebanon (UNIFIL). The main issue before the Support Group is the spillover of the Syrian civil war, whether it is the immense crisis of refugees or the political impact of the war on the fragile political consensus in Lebanon. Lebanon’s interim President Michel Sleiman said that his country faced an “existential crisis”. Sleiman is not known for hyperbole. This is a phrase worth careful attention. It is why the U.N. organised such a group. Things are tense in a region that has its share of tensions.

The main issue on the table is the refugee crisis. In April 2011, the first Syrians, 5,000 in all, crossed into northern Lebanon. Since then the numbers have escalated, with U.N.-registered refugees now at 750,000. The Lebanese government estimates that the number is now 1.5 million, in a country that has a generally understood population of five million (the last official census was taken in 1932, after which the confessional divides were too tense to allow any accounting of them). Lebanon, unlike Jordan, Iraq and Turkey, has not built camps for the refugees. The policy here is to integrate refugees into extant neighbourhoods. This allowed the Syrians to try and assimilate into infrastructure that was already in place. The Syrians are in 1,450 locations across Lebanon.

What the integration strategy also means, however, is that the additional population puts a strain on infrastructural resources that are already overburdened. “The presence of Syrian refugees in many of Lebanon’s most deprived areas has added to inter-communal tensions and put local economies under strain,” said Dr Kamel Mohanna, president of Amel Association International, one of the most engaged non-governmental organisations (NGOs) in Lebanon. “The added pressure of increase in population is leading to problems with health care and education, wage deflation because of competition for jobs and an influx of cheap labour.” Nonetheless, Dr Mohanna emphasised, “Lebanese and Palestinian communities are playing a crucial role as host communities and their solidarity is impressive.” U.N. assistance can run into predictable problems—if U.N. trucks come to dispense water and blankets to refugees, this leaves a bitter taste in the mouth of their hosts, whose access to basic goods is minimal. U.N. cash-for-food and cash-for-housing programmes also create tension, as refugees can then use these payments as a subsidy as they offer themselves at lower wage rates in the informal labour market.

For the Support Group meeting, the World Bank conducted an assessment of Lebanon’s problems (“Lebanon: Economic and Social Impact Assessment of the Syrian Conflict”, September 20). Its findings mirrored what aid workers have been saying—that the refugee influx has negatively impacted on “economic activity in Lebanon, on government finances, and on key sectors, such as health and education and on infrastructure, as well as on vulnerable communities affected by the crisis”. This last phrase is crucial because it recognises that this is no longer simply a refugee crisis but one that has detrimental effects on the host community as well. Such tensions are on the surface of the mainly working-class areas where the bulk of the refugees now live, but they are also apparent among the elite whose access to private schools in particular has been challenged by the arrival of sections of the Syrian elite. Palpable unease hangs in the air, reflected by those who work in the NGO sector producing services for the refugees.

An interim economy Lebanon struggles with a debt-to-gross domestic product ratio that is in the range of 140 per cent, with its revenues deeply reliant upon remittances (about a fifth of its GDP), tourism and Gulf investment. A banking system that is substantially without regulations depends on the passage of petrodollars and an onrush of investment in Lebanese real estate. Nassib Ghobril, who is the head of research at Byblos Bank, has estimated that the per capita capital inflow will total about $1,800 each year, the highest ratio in the Global South. The buildings on Beirut’s Corniche that look out over the Mediterranean Sea and boast large apartments at millions of dollars sit with their lights out. These idle apartments are investments from the Gulf, which add little to the economy once they have been purchased.

In early October, Inger Andersen, the World Bank’s vice-president for the Middle East [West Asia] and North Africa, came to Beirut to meet with leading governmental and political leaders. President Sleiman met her at Baabda Palace and welcomed the “exceptional, unprecedented speed” with which the bank had produced its assessment. Beyond this assessment, however, things are bleak. The World Bank estimates that Lebanon alone will require $7.5 billion from 2012 to 2014 to cover the cost of the conflict. At the New York meeting, the participants pledged $339 million in humanitarian aid, including $74 million to support refugees. This is a drop in the bucket.

Jordan Jordan, which has not received the same kind of focus, is also weighed down heavily by the social, political and financial impact of the refugee crisis. Its largest city is now the Zaatari camp, which costs half a million dollars a day to maintain. Geographically, Jordan is in an unenviable place: it borders Iraq and Syria, two countries that have recently had major political chaos and so have sent refugees to this small kingdom in the hundreds of thousands; and it borders Palestine, which is occupied by Israel, whose military adventures routinely send refugees hurtling across the Allenby Bridge. Jordan is reliant upon gas and oil imports, but these are often curtailed as a result of geopolitical conflict: smooth delivery from Iraq ended in 2003, and in 2011, as Egypt went into a tailspin, Jordan’s energy bill skyrocketed (Jordan imported 92 per cent of its energy from Egypt). In August 2012, the International Monetary Fund (IMF) conducted a Stand-By-Agreement (SBA) with Jordan that insisted in a reduction of the kingdom’s energy subsidy, which the government ended in November. Preparing for the IMF’s first review of this SBA, Shakour Shaalan, the IMF’s country director, recognised that the end to the energy subsidy had had an impact on the population but conceded, “Energy sector reforms are at the centre of the fiscal efforts.” The IMF team endorsed this view and urged Jordan to push more firmly to cut expenditures on the social account. Their May 2013 report concedes that the refugee crisis is dire but suggests that “this could to a large extent be mitigated by international assistance”.

To draw in this “international assistance”, the World Bank proposed the creation of a multi-donor trust fund. But the outcome of the donors’ conference in Kuwait held this January does not bode well for international assistance. The U.N. came to the conference with a bill of $1.5 billion to fund its Regional Response Plan ($1 billion) and its Syria Humanitarian Assistance Response Plan ($519 million). Hands went up around the room as world leaders made pledges in the hundreds of millions towards the U.N. and NGOs, but only fractions of the pledges had been met by September. At the U.N. General Assembly meeting, Secretary-General Ban Ki-moon said, “We have raised just 40 per cent of the $4.4 billion needed for Syria and neighbouring countries for this year.” If the money was slow to come, so too were pledges to take Syrian refugees into asylum programmes out of the region. António Guterres, the U.N. High Commissioner for Refugees, told a news conference that there was now talk of resettlement of 10,000 Syrians out of the area—not significant enough to make a difference to Syria’s neighbours. Even this is unsure, as the United States and Western European states are wary of accepting refugees given their lack of domestic consensus on immigration. The U.S. has currently taken in only 33 registered Syrian refugees. Australia has agreed to take in 500.

In Lebanon, these empty pledges and anaemic policies frustrate politicians. Wael Abu Faour, the Minister of Social Affairs, is emblematic of this despair. “Nothing of significance has materialised so far, not one hospital, not one school. We are more than disappointed. We are frustrated. It has been more than two years of advice, of lessons, of promises and nothing.” U.N.’s Special Coordinator for Lebanon Derek Plumby recognises this impasse by defining the assistance as a “continuous process”. Ambassador Nassif Hitti, a veteran Arab League official, said that the formation of the Support Group showed that there was “rare external consensus”. Whether this consensus will be able to produce policies that lift the burden from Lebanon is another question. Everything relies upon donor funding, said a senior U.N. official. All other policy suggestions, of which there are many, have fallen by the wayside.

Foreign aid, Dr Mohanna noted, “is far lower than what is required to respond effectively to the crisis”. Instead, the international financial houses, led by the IMF, have begun to talk about loans to Lebanon. But this would strain the future finances of Lebanon, which would be forced to take responsibility in the future for its emergency commitments to the refugee crisis now. There is no longer a “Syrian crisis”, Dr Mohanna said, but a “Syrian-Lebanese crisis”. Equally, there is no Lebanese crisis alone. A solution to the refugee crisis must include a discussion about a ceasefire and peace in Syria. Financial assistance is imperative but there is no substitute, Dr Mohanna pointed out, for a political solution in Syria itself.