During the massive protests in the wake of the murder of Rafiq Al-Hariri, the Lebanese economy was incredibly stable. The Lira barely felt the shock of the political turmoil. But new reports suggest the Lebanese government spent two billion dollars holding the Lira up.
That’s two billion pounds to add to the current debt of $33.49 bullion. So let’s put this in context – the demonstrations cost nearly 10% of the amount it cost to rebuild Lebanon after the end of the 25 year Civil War.
That’s an expensive demonstration.
But it’s not just the debt which got worse. The country’s main income provider – tourism – is suffering badly. Lebanon was enjoying its highest number of tourists since the war in February – but that all ended with the political turmoil.
The Syrian workers who rebuilt Lebanon and lived in appaling conditions have all but left – who will carry out the cheap manual labour now?
And of course, the political shakiness is likely to scare off foreign investors. Lebanon was already struggling to recreate its pre-war image as the banking centre of the Arab World – the Transparency International Corruption Perceptions Index 2004 rated Lebanon as 97th out of 146 countries. That’s lower than Syria, Iran and even Saudi Arabia!
The poor haven’t seen much of the benefits of the expensive reconstruction of central Beirut (below) – which they, in their slums, are still paying for.
And it seems the same is happening again. The so-called Gucci revolution has landed another pile of debt on people who care more about where tomorrow’s wage is coming from, than they do about Saad Al-Hariri.
Not for the first time will a Hariri preside over a massive increase in Lebanon’s national debt.