x Abu Dhabi, UAEMonday 24 July 2017

Lebanon another Norway? It will be lucky to match Venezuela

What is the likelihood of Lebanon matching Norway as a petrodollar success story? It's not even likely to match Venezuela's woeful example.

Martin Skancke, a consultant specialising in managing natural resources, told Executive, the Lebanese business magazine, this month that any oil and gas discoveries off Lebanon’s coast could actually make the country “worse off”. It’s not hard to see why.

As he correctly points out, we don’t have the institutions, mechanisms or the transparency to efficiently husband any revenues and spend them on nation-building projects and initiatives.

In a perfect world these would include increasing foreign currency reserves and servicing our huge national debt as well as investing in, and eventually privatising, infrastructure. Once that is done we could create a sovereign wealth or a social welfare fund like those clever Norwegians did. But we are not Norway.

Oil companies looking for positive signs of our capacity to build strong institutions will not be encouraged by our proud tradition of political infighting and the fact it has taken nearly six months to form a cabinet. Then there is the slight problem of the low intensity civil war that has been allowed to slow burn for more than two years in Tripoli, our second city.

But another, equally telling, indicator of our dysfunctional DNA could be found last week in what is left of the country’s historic Cedar forest near the northern town of Bcharreh.

From this ancient site has erupted a scandal that deliciously captures everything that is wrong with our often repulsive society, gathering as it does the self-importance of the ruling elite, the absence of the rule of law in the face of chronic corruption and intimidation, the cowardice of the authorities, and, last but not least, the moronic behaviour of many of its citizens.

Our story starts with Gebran Tawk, a former member of parliament (MP) and mountain bigwig. By and large Lebanese MPs, unlike, say their European counterparts, don’t do anything. They might solve a few local disputes or push through the odd permit, but when this happens there is often a fee involved. Some even live abroad and yet they may still be revered by the people they pay to vote for them.

This summer, Mr Tawk wanted to lay on a bash for his son’s August wedding and did what any loving parent would do and built an amphitheatre to accommodate the 3,000 guests during a three-day extravaganza. True, we Lebanese do have a well-developed sense of the overstated but the problem was not one of taste but the fact that the concrete monstrosity was built on a Unesco heritage site.

Activists, quite rightly, objected to the plans, but Mr Tawk argued, pretty lamely it must be said, that it was private land and that no trees had been uprooted. What he failed to grasp was that his project, what with all the fireworks, valet parkers, Louboutin heels, Cohiba cigars and whatever else, threatened to upset the area’s delicate ecosystem. In any case, it was against the law and the state slapped a ban on the works.

The wedding went ahead as planned, but last week the state decided to act and sent in the bulldozers to tear down the structure. Officials must have been expecting trouble because the elite riot police unit was also dispatched. They were met by vicious, stone-throwing, tyre-burning “supporters” of Mr Tawk who would not let them pass.

An uneasy truce ensued, with Mr Tawk generously agreeing to allow the authorities in on the condition it looked at all the other “irregularities” that have taken place in the area.

And so a defied state order, obstructed justice and injured policemen all appear to have been quietly swept under the carpet in the wake of that wonderful Lebanese tradition – the compromise. If the state can’t stop an illegal construction, what hope does it have of husbanding billions of petrodollars?

Norway? You’ve got to be kidding.

At the rate we are going, we will be lucky to emulate Venezuela, which discovered oil in 1914. It is currently the fifth biggest oil-exporting country in the world with the second largest reserves of heavy crude oil. And yet 99 years later GDP per capita is still only US$12,700.

Just saying.

Michael Karam is a freelance writer based in Beirut