Connect with us

Economy

Lebanese-Chinese Partnership in the Midst of the Lebanese Economic Decline

Published

on

Chinese Ambassador to Lebanon Wang Kejian (R, front) and Lebanese Health Minister Hamad Hassan (L, front) sign at a handover ceremony of medical supplies donated by China in Beirut, Lebanon, April 16, 2020. (Photo by Bilal Jawich/Xinhua)

Unfortunately, it seems that the Lebanese economic scenario is similar to the Venezuelan scenario. I am not optimistic. There is no glimmer of hope on the horizon, and it is likely that 2021 will be “the year of the major Lebanese economic setback.” COVID-19 has established new economic rules on many countries with fragile economies, including Lebanon, as many of the huge global institutions have gone bankrupt and the world has turned to a social welfare system, especially in the days of quarantine and lockdown. However, the Lebanese crisis began before the pandemic. The Lebanese media has been equipped with psychological weapons to spread poisons against the Lebanese authority, and the scenes of riots, cracking, and insults supported both externally and internally have not ended. These tools perfectly performed their destructive mission.

The Lebanese economic crisis is due to an external decision taken by the United States administration, the decision to impoverish and starve. President Trump’s administration prevented the transfer of funds from abroad to Lebanon in dollars, thus receiving the money in Lebanese pounds coincided with the increase in the exchange rate of the Lebanese pound against the dollar. The second step is to prevent Lebanese banks from delivering deposits to depositors in dollars, so the depositor loses more than half the value of the deposits if he/she agrees to withdraw money according to the exchange value determined by the bank. The third step is to prevent international aid to Lebanon, both Arab and foreign. The World Bank has linked aid to Lebanon to crippling conditions such as demarcating the borders with Israel, while insisting on the maritime borders that contain oil but according to international conditions, in addition to keeping the Syrian refugees and passing demands such as resettlement. These conditions thwarted the efforts of the Lebanese delegation to the World Bank.

It is true that the Lebanese system is “democratic,” but the banking system in Lebanon is a “disguised dictatorship.” So the governor of the Banque du Liban is a ruler by his order, it is a detachment from state authority. Article 26 of the Monetary and Credit Law and the Establishment of the Central Bank stipulates that the ruler enjoys the broadest powers to manage the Central Bank and conduct its business. Consequently, no one is capable of stopping or putting an end to the governor of the Banque du Liban. The Central Bank has its own authority, which is independent of the rest of the Lebanese authorities. The governor of the bank exercises his authority alone and in some cases within agencies, but the final decision is up to him. The governor has acquired broad powers and continues to aspire to expand his powers even more despite the total economic collapse in Lebanon. The role of the governor’s four deputies is advisory and does not affect the ruler’s decisions. He appoints and dismisses employees and the implementation of the Monetary and Credit Law depends on him. The Lebanese law granted the bank’s governor many and wide powers, and he also became the custodian of the state’s financial and monetary policies.

Some point out that Lebanon is a cash-sufficient country, and the Lebanese state possesses immovable capital that pumps huge amounts of money, and I support this proposal. The Lebanese banks are filled with huge amounts of money from local, Arab and international depositors, in addition to the permanent remittances of expatriates, which constitute a vital economic artery to Lebanon in dollars. Consequently, the ruler’s suggestion that Lebanon is a collapsed and economically bankrupt country is a fragile part of the US scenario, which aims to “impoverish and starve” the Lebanese people by draining the Lebanese market of dollars by means previously mentioned, and then co modifying the dollar and manipulating its exchange rate. Every Lebanese banker who has agreed to implement these unfair economic decisions against Lebanon is a traitor and worse than the enemy against the Lebanese people. Honour requires stepping down and not behaving in the dark tunnel.

The official Lebanese system has always been directly or indirectly loyal to the West, for France was the guardian of Lebanon, and it is the country that granted Lebanon its independence, and a large group of Lebanese are still associated with this state. France is still morally present in Lebanon. The deteriorating political situation forced French President Emmanuel Macron to personally come to Lebanon and gather all political leaders and draw up a road map. Lebanon has been linked economically with the Arab Gulf states, as these countries were the main financiers for Lebanon in the reconstruction, financing of economic projects and the promotion of tourism. A large part of the Lebanese workforce is in the Gulf countries, as they transfer money in US dollars to Lebanon. Saudi Arabia, for example, was a sponsor of national reconciliation in the past, and it called for the Taif Agreement to end the Lebanese civil war, and the Lebanese government’s presidency has a moral connection with Saudi Arabia. Therefore, Saudi satisfaction is a permanent condition for the formation of governments in Lebanon. The US is the party with the greatest influence through Lebanon’s financial links and banking laws. The US has an economic and political moral force that greatly affects Lebanon. The current crisis that Lebanon is going through is mainly related to decisions of the US administration, just as it is the case with Venezuela, Iran and others.

Unfortunately, despite Lebanon’s historical ties with its Western allies, the recent decision was to abandon Lebanon and pursue a policy of impoverishment and starvation against a culturally, religiously and socially diverse country. A true friend is at a time of adversity and difficulties. It has become evident that Lebanon is nothing more than a tool in the hands of the West to achieve goals and pass interests in the Middle East. It seems that this tool is no longer useful and it has been abandoned. However, in the eastern part of the globe, states, governments and peoples have never followed the path of domination and imposing decisions on their friends, and I particularly mention the Chinese state. China’s foreign policy stipulates the principles of non-interference in the internal affairs of others, respect for the sovereignty of other countries and mutual benefit. All powerful countries in ancient and contemporary history enslaved people, plundered wealth, and widened the rift between them and the poor countries. However, it is clear that China does not aspire to be a pole or to rule the world alone as the US and its predecessors did. Chinese President Xi Jinping has said that China aspires to build a “participatory society with a shared destiny.”The Chinese state takes into account the interest of all nations and is therefore not selfish.

Lebanon has a bitter and unsuccessful experience with the West. The established alliances with most Western capitals led to economic collapse and catastrophic failure on all levels. On the other hand, the Chinese were and are still open to a partnership with Lebanon. Chinese Ambassador to Lebanon Wang Kejian indicated that China is open to partnering with Lebanon on the condition of formal governmental cooperation with the Chinese side. The most important Western and Arab capitals are moving east and expanding their economic and political relations with the Chinese, but it seems that Lebanon is forbidden to go east. The US decision was taken years ago to prevent Lebanon from allying with the Chinese or establishing a strategic partnership because that contradicts US interests, taking into account the geopolitics of Lebanon on the borders with Syria, Israel and the Mediterranean. The Lebanese government had previously requested a postponement of the partnership with the Chinese, while the neighbouring countries from all sides were flocking to partner with China, to name but a few: Egypt, Israel, the United Arab Emirates and others.

Some Lebanese still prefer everything coming from the West. This bad habit has brought the homeland through a dark tunnel, and a segment of the Lebanese is still insistent on partnering with the West and believes that there is no point in partnering with eastern countries. Lebanon at this stage lies in the abyss. It is not in an alliance with the East and is mortgaged to the West. This reality should not continue. Therefore, a bold decision must be made, either total dependence of the West and complete surrender or alliance with the East, thus replacing the Western allies with Eastern allies while retaining some Friendships and good relations with Western countries that respect Lebanon’s sovereignty and do not interfere with its internal affairs. My vision is that the only way out for a new Lebanon is through new alliances and a new system that will hand over the reins of affairs to specialized youth, away from political and official interference. This coincides with the proposal of the Chinese delegation regarding its partnership with Lebanon.

We do not have to wait and waste time. The time factor has become negative for Lebanon. It worsens the deterioration of the economic situation. I turn to His Excellency the President of the Republic to take this frank message into consideration, “The salvation of Lebanon is to go east and reach out to the Chinese.” On the election of the President of the Republic, General Michel Aoun, Chinese President Xi Jinping addressed him with a message on November 4, 2016 stating, “I attach great importance to developing Sino-Lebanese relations in order to make joint efforts with you to further develop friendly relations and mutual cooperation between China and Lebanon, which is beneficial on the two countries and the two peoples better.”The Chinese are open to cooperation, but this partnership will not become a reality except with official Lebanese cooperation, as Ambassador Wang Kejian pointed out. The issue of the Lebanese-Chinese partnership will remain present and we will not stop calling for it until it turns into a full partnership and that the Lebanese-Chinese relations rise to the level of the extraordinary relationship.

Mohamad Zreik is a doctor of international relations. His research interests focuses on Middle Eastern Studies, Chinese foreign policy, China-Arab relations, and international relations of East Asia.

Continue Reading
Comments

Economy

Is Myanmar an ethical minefield for multinational corporations?

Published

on

By

Business at a crossroads

Political reforms in Myanmar started in November 2010 followed by the release of the opposition leader, Aung San Suu Kyi, and ended by the coup d’état in February 2021. Business empire run by the military generals thanks to the fruitful benefits of democratic transition during the last decade will come to an end with the return of trade and diplomatic sanctions from the western countries – United States (US) and members of European Union (EU).  US and EU align with other major international partners quickly responded and imposed sanctions over the military’s takeover and subsequent repression in Myanmar. These measures targeted not only the conglomerates of the military generals  but also the individuals who have been appointed in the authority positions and supporting the military regime.

However, the generals and their cronies own the majority of economic power both in strategic sectors ranging from telecommunication to oil & gas and in non-strategic commodity sectors such as food and beverages, construction materials, and the list goes on. It is a tall order for the investors to do business by avoiding this lucrative network of the military across the country. After the coup, it raises the most puzzling issue to investors and corporate giants in this natural resource-rich country, “Should I stay or Should I go?”

Crimes against humanity

For most of the people in the country, war crimes and atrocities committed by the military are nothing new. For instances, in 1988, student activists led a political movement and tried to bring an end to the military regime of the general Ne Win. This movement sparked a fire and grew into a nationwide uprising in a very short period but the military used lethal force and slaughtered thousands of civilian protestors including medical doctors, religious figures, student leaders, etc. A few months later, the public had no better options than being silenced under barbaric torture and lawless killings of the regime.

In 2007, there was another major protest called ‘Saffron Uprising’ against the military regime led by the Buddhist monks. It was actually the biggest pro-democracy movement since 1988 and the atmosphere of the demonstration was rather peaceful and non-violent before the military opened live ammunitions towards the crowd full of monks. Everything was in chaos for a couple of months but it ended as usual.

In 2017, the entire world witnessed one of the most tragic events in Myanmar – Again!. The reports published by the UN stated that hundreds of civilians were killed, dozens of villages were burnt down, and over 700,000 people including the majority of Rohingya were displaced to neighboring countries because of the atrocities committed by the military in the western border of the country. After four years passed, the repatriation process and the safety return of these refugees to their places of origin are yet unknown. Most importantly, there is no legal punishment for those who committed and there is no transitional justice for those who suffered in the aforementioned examples of brutalities.

The vicious circle repeated in 2021. With the economy in free fall and the deadliest virus at doorsteps, the people are still unbowed by the oppression of the junta and continue demanding the restoration of democracy and justice. To date, Assistant Association for Political Prisoner (AAPP) reported that due to practicing the rights to expression, 1178 civilians were killed and 7355 were arrested, charged or sentenced by the military junta. Unfortunately, the numbers are still increasing.

Call for economic disengagement

In 2019, the economic interests of the military were disclosed by the report of UN Fact-Finding Mission in which Myanmar Economic Corporation (MEC) and Myanmar Economic Holding Limited (MEHL) were described as the prominent entities controlled by the military profitable through the almost-monopoly market in real estate, insurance, health care, manufacturing, extractive industry and telecommunication. It also mentioned the list of foreign businesses in partnership with the military-linked activities which includes Adani (India), Kirin Holdings (Japan), Posco Steel (South Korea), Infosys (India) and Universal Apparel (Hong Kong).

Moreover, Justice for Myanmar, a non-profit watchdog organization, revealed the specific facts and figures on how the billions of revenues has been pouring into the pockets of the high-ranked officers in the military in 2021. Myanmar Oil & Gas Enterprise (MOGE), an another military-controlled authority body, is the key player handling the financial transactions, profit sharing, and contractual agreements with the international counterparts including Total (France), Chevron (US), PTTEP (Thailand), Petronas (Malaysia), and Posco (South Korea) in natural gas projects. It is also estimated that the military will enjoy 1.5 billion USD from these energy giants in 2022.

Additionally, data shows that the corporate businesses currently operating in Myanmar has been enriching the conglomerates of the generals and their cronies as a proof to the ongoing debate among the public and scholars, “Do sanctions actually work?” Some critics stressed that sanctions alone might be difficult to pressure the junta without any collaborative actions from Moscow and Beijing, the longstanding allies of the military. Recent bilateral visits and arm deals between Nay Pyi Taw and Moscow dimmed the hope of the people in Myanmar. It is now crystal clear that the Burmese military never had an intention to use the money from multinational corporations for benefits of its citizens, but instead for buying weapons, building up military academies, and sending scholars to Russia to learn about military technology. In March 2021, the International Fact Finding Mission to Myanmar reiterated its recommendation for the complete economic disengagement as a response to the coup, “No business enterprise active in Myanmar or trading with or investing in businesses in Myanmar should enter into an economic or financial relationship with the security forces of Myanmar, in particular the Tatmadaw [the military], or any enterprise owned or controlled by them or their individual members…”

Blood money and ethical dilemma

In the previous military regime until 2009, the US, UK and other democratic champion countries imposed strict economic and diplomatic sanctions on Myanmar while maintaining ‘carrot and stick’ approach against the geopolitical dominance of China. Even so, energy giants such as Total (France) and Chevron (US), and other ‘low-profile’ companies from ASEAN succeeded in running their operations in Myanmar, let alone the nakedly abuses of its natural resources by China. Doing business in this country at the time of injustice is an ethical question to corporate businesses but most of them seems to prefer maximizing the wealth of their shareholders to the freedom of its bottom millions in poverty.

But there are also companies not hesitating to do something right by showing their willingness not to be a part of human right violations of the regime. For example, Australian mining company, Woodside, decided not to proceed further operations, and ‘get off the fence’ on Myanmar by mentioning that the possibility of complete economical disengagement has been under review. A breaking news in July, 2021  that surprised everyone was the exit of Telenor Myanmar – one of four current telecom operators in the country. The CEO of the Norwegian company announced that the business had been sold to M1 Group, a Lebanese investment firm, due to the declining sales and ongoing political situations compromising its basic principles of human rights and workplace safety.

In fact, cutting off the economic ties with the junta and introducing a unified, complete economic disengagement become a matter of necessity to end the consistent suffering of the people of Myanmar. Otherwise, no one can blame the people for presuming that international community is just taking a moral high ground without any genuine desire to support the fight for freedom and pro-democracy movement.

Continue Reading

Economy

The Covid After-Effects and the Looming Skills Shortage

Published

on

coronavirus people

The shock of the pandemic is changing the ways in which we think about the world and in which we analyze the future trajectories of development. The persistence of the Covid pandemic will likely accentuate this transformation and the prominence of the “green agenda” this year is just one of the facets of these changes. Market research as well as the numerous think-tanks will be accordingly re-calibrating the time horizons and the main themes of analysis. Greater attention to longer risks and fragilities is likely to take on greater prominence, with particular scrutiny being accorded to high-impact risk factors that have a non-negligible probability of materializing in the medium- to long-term. Apart from the risks of global warming other key risk factors involve the rising labour shortages, most notably in areas pertaining to human capital development.

The impact of the Covid pandemic on the labour market will have long-term implications, with “hysteresis effects” observed in both highly skilled and low-income tiers of the labour market. One of the most significant factors affecting the global labour market was the reduction in migration flows, which resulted in the exacerbation of labour shortages across the major migrant recipient countries, such as Russia. There was also a notable blow delivered by the pandemic to the spheres of human capital development such as education and healthcare, which in turn exacerbated the imbalances and shortages in these areas. In particular, according to the estimates of the World Health Organization (WHO) shortages can mount up to 9.9 million physicians, nurses and midwives globally by 2030.

In Europe, although the number of physicians and nurses has increased in general in the region by approximately 10% over the past 10 years, this increase appears to be insufficient to cover the needs of ageing populations. At the same time the WHO points to sizeable inequalities in the availability of physicians and nurses between countries, whereby there are 5 times more doctors in some countries than in others. The situation with regard to nurses is even more acute, as data show that some countries have 9 times fewer nurses than others.

In the US substantial labour shortages in the healthcare sector are also expected, with anti-crisis measures falling short of substantially reversing the ailments in the national healthcare system. In particular, data published by the AAMC (Association of American Medical Colleges), suggests that the United States could see an estimated shortage of between 37,800 and 124,000 physicians by 2034, including shortfalls in both primary and specialty care.

The blows sustained by global education from the pandemic were no less formidable. These affected first and foremost the youngest generation of the globe – according to UNESCO, “more than 1.5 billion students and youth across the planet are or have been affected by school and university closures due to the COVID-19 pandemic”. On top of the adverse effects on the younger generation (see Box 1), there is also the widening “teachers gap”, namely a worldwide shortage of well-trained teachers. According to the UNESCO Institute for Statistics (UIS), “69 million teachers must be recruited to achieve universal primary and secondary education by 2030”.

From our partner RIAC

Continue Reading

Economy

Accelerating COVID-19 Vaccine Uptake to Boost Malawi’s Economic Recovery

Published

on

Lunzu market in southern Malawi. WFP/Greg Barrow

Since the onset of the COVID-19 pandemic, many countries including Malawi have struggled to mitigate its impact amid limited fiscal support and fragile health systems. The pandemic has plunged the continent into its first recession in over 25 years, and vulnerable groups such as the poor, informal sector workers, women, and youth, suffer disproportionately from reduced opportunities and unequal access to social safety nets.

Fast-tracking COVID-19 vaccine acquisition—alongside widespread testing, improved treatment, and strong health systems—are critical to protecting lives and stimulating economic recovery. In support of the African Union’s (AU) target to vaccinate 60 percent of the continent’s population by 2022, the World Bank and the AU announced a partnership to assist the Africa Vaccine Acquisition Task Team (AVATT) initiative with resources, allowing countries to purchase and deploy vaccines for up to 400 million Africans. This extraordinary effort complements COVAX and comes at a time of rising cases in the region.

I am convinced that unless every country in the world has fair, broad, and fast access to effective and safe COVID-19 vaccines, we will not stem the spread of the pandemic and set the global economy on track for a steady and inclusive recovery. The World Bank has taken unprecedented steps to ramp up financing for Malawi, and every country in Africa, to empower them with the resources to implement successful vaccination campaigns and compensate for income losses, food price increases, and service delivery disruptions.

In line with Malawi’s COVID-19 National Response and Preparedness Plan which aims to vaccinate 60 percent of the population, the World Bank approved $30 million in additional financing for the acquisition and deployment of safe and effective COVID-19 vaccines. This financing comes as a boost to Malawi’s COVID-19 Emergency Response and Health Systems Preparedness project, bringing World Bank contributions in this sector up to $37 million.

Malawi’s decision to purchase 1.8 million doses of Johnson and Johnson vaccines through the AU/African Vaccine Acquisition Trust (AVAT) with World Bank financing is a welcome development and will enable Malawi to secure additional vaccines to meet its vaccination target.

However, Malawi’s vaccination campaign has encountered challenges driven by concerns regarding safety, efficacy, religious and cultural beliefs. These concerns, combined with abundant misinformation, are fueling widespread vaccine hesitancy despite the pandemic’s impact on the health and welfare of billions of people.  The low uptake of COVID-19 vaccines is of great concern, and it remains an uphill battle to reach the target of 60 percent by the end of 2023 from the current 2.2 percent.

Government leadership remains fundamental as the country continues to address vaccine hesitancy by consistently communicating the benefits of the vaccine, releasing COVID data, and engaging communities to help them understand how this impacts them.

As we deploy targeted resources to address COVID-19, we are also working to ensure that these investments support a robust, sustainable and resilient recovery. Our support emphasizes transparency, social protection, poverty alleviation, and policy-based financing to make sure that COVID assistance gets to the people who have been hit the hardest.

For example, the Financial Inclusion and Entrepreneurship Scaling Project (FInES) in Malawi is supporting micro, small, and medium enterprises by providing them with $47 million in affordable credit through commercial banks and microfinance institutions. Eight months into implementation, approximately $8.4 million (MK6.9 billion) has been made available through three commercial banks on better terms and interest rates. Additionally, nearly 200,000 urban households have received cash transfers and urban poor now have more affordable access to water to promote COVID-19 prevention.

Furthermore, domestic mobilization of resources for the COVID-19 response are vital to ensuring the security of supply of health sector commodities needed to administer vaccinations and sustain ongoing measures. Likewise, regional approaches fostering cross-border collaboration are just as imperative as in-country efforts to prevent the spread of the virus. United Nations (UN) partners in Malawi have been instrumental in convening regional stakeholders and supporting vaccine deployment.

Taking broad, fast action to help countries like Malawi during this unprecedented crisis will save lives and prevent more people falling into poverty. We thank Malawi for their decisive action and will continue to support the country and its people to build a resilient and inclusive recovery.

This op-ed first appeared in The Nation, via World Bank

Continue Reading

Publications

Latest

Finance49 mins ago

Credit Suisse to pay $475 million to U.S. and U.K. authorities

Credit Suisse Group AG has agreed to pay nearly $475 million to U.S. and U.K authorities, including nearly $100 million...

Americas3 hours ago

Gallup: World’s Approval of U.S. Govt. Restored to Obama’s Record High

On October 19th, Gallup issued their “2021 Rating World Leaders” report and finds that “Six months into the first year...

Science & Technology5 hours ago

China beats the USA in Artificial Intelligence and international awards

The incoming US Secretary of the Air Force said that China was winning the battle of Artificial Intelligence over the...

Development7 hours ago

Iraq: An Urgent Call for Education Reforms to Ensure Learning for All Children

Learning levels in Iraq are among the lowest in the Middle East & North Africa (MENA) region and are likely...

Middle East9 hours ago

Breaking The Line of the Israel-Palestine Conflict

The conflict between Israel-Palestine is a prolonged conflict and has become a major problem, especially in the Middle East region....

Development13 hours ago

More Funding for Business and Trade to Help Lao PDR Recover from Pandemic

The World Bank and the Government of Lao PDR have agreed to scale up a Competitiveness and Trade Project that...

South Asia15 hours ago

Changing complexion of “militancy” in the occupied Kashmir

Two teachers, Supinder Kaur and Deepak Chand, were shot dead in Srinagar on October7, 2021.The Resistance front owned the killing....

Trending