The Lebanon Report
Number 3
Fall 1996
Grading the government - Kemal Shehadi
The one good thing about the 1996 parliamentary elections is that they will bring
an end to the ritual shifting of responsibility and blame between government and
parliament. Now that the prime minister, Rafiq al-Hariri controls the largest coalition
of deputies and is allied to the second largest coalition, that of the parliament speaker,
Nabih Birri, he cannot hold parliament responsible for what may go wrong with his
projects. Since 1992, members of the government have blamed parliament for delaying
reconstruction projects, for wasteful spending, for blocking administrative reforms, and
for many other ills. This will no longer be possible. Mr. Hariri and his government
will become fully responsible and accountable for the success or failure of their
policies.
Elections are an important occasion in the life of a democratic country, Lebanon notwithstanding.
They are the mechanism by which ruling elites are held accountable and their on-the-job
performance. In Lebanon, however, elections provide at best a more modest opportunity to evaluate the performance of an outgoing government. Following is
a scorecard of the performance of the two Hariri governments in the last four years.
Reconstruction:
Above average.
Positive considerations
(+): The Hariri government has concentrated on rebuilding the country's infrastructure.
Work is proceeding steadily on rehabilitating electricity, road and highway, telecommunication,
irrigation, water supply, and waste water networks. The unthinkable is happening: crews are working around the clock on public works projects.
Negative considerations
( _ ): Bottlenecks and delays are frequent due in large part to the poor administrative
capacity of state institutions.
Projection:
Reconstruction projects will continue since bottlenecks are not likely to worsen.
A great deal depends on whether the newly-formed Consultative Group for the Reconstruction
of Lebanon which is scheduled to meet in October will produce firm financing commitments.[1] The reconstruction program needs to be prioritized, re-phased, and coordinated
with the stabilization program.
Rebuilding the economy:
Average
(+) The country has made the transition from a war economy to a regulated market economy.
The real rate of GDP growth in the last four years has been impressive by international
standards even though 1996 is likely to show a slowdown. The financial markets are operating again and laws and regulations governing their operations, along with
appropriate safeguards, are being developed. The government is currently negotiating
a Euro-Lebanese Association Agreement which would promote investment in Lebanon.
(_) Growth rates are sensitive to capital inflows which can be reversed by political
developments beyond the control of the government. Furthermore, growth has not encompassed
all sectors of the economy and all socio-economic groups. The new international trade regime (World Trade Organization) and the proposed Euro-Mediterranean Free Trade
Area are likely to cause domestic economic and social dislocations.
Projection:
Growth will continue, albeit at a slower pace. In the medium term, however, the health
of the Lebanese economy will depend on the prospects for regional peace and stability.
In addition, the outlook will darken if the government and private sector do not
gear up to the increased competition from Europe and other countries in the region.
Rebuilding state institutions:
Below average.
(+) The policeman on the street and the judicial system command more respect than
before. A major step forward was the Constitutional Court's ruling declaring the
initial parliamentary electoral law unconstitutional.
( _ The government has repeatedly dealt big blows to the sanctity of institutions
and the "rule of law," for example the decisions to support an extension of President
Hrawi's mandate and an unconstitutional electoral law which ultimately undermined
the progress made by the Constitutional Court's ruling.
Projection:
Slow but limited progress due to public pressure, which will be countered by the
government's tendency to sacrifice the rule of law to the altar of political expediency.
Public administration reform:
Below average.
(+) The Ministry of Administrative Reform has been hard at work developing plans,
organizing studies and seminars, and suggesting ideas for reforms. The government
has even begun computerizing some government operations.
(_) So far, reform has been limited to plans, studies, seminars, and ideas; no long-term
vision exists of what the role of the state should be in the economy and society.
One need not bother looking for it in the National Administration Reform Plan (NARP).
Projection:
Slow and limited progress for lack of political will and the existence of a strong
political coalition in favor of more serious but radical reform.
Public finance:
Average.
(+) The financial stabilization program has succeeded: inflation is under control,
the pound is appreciating slowly, and foreign exchange reserves are rising. The 1997
draft budget submitted to parliament shows that the finance ministry is able to address
the structural weaknesses of previous budgets: the budget is more transparent than
ever before. Revenue collection is improving and an improved auditing system is being
introduced.
(_) The waste of public resources continues due to mismanagement by various ministries
and the absence of clear spending priorities. The debt is growing at an alarming
rate. Interest rates remain high.
Projection:
Mr. Hariri may take advantage of the momentum of his electoral success and his bargaining
leverage prior to the formation of a new government to implement needed spending
cuts. The drastic fall in customs revenues which will result from the Euro-Lebanese
Association Agreement has to be compensated by new revenues.
Investing in human resources:
Below average.
(_) There are no positive considerations on this count. For a society coming out of
15 years of war and entering a competitive international economic environment, investment
in education, training, health-care, and social security should be a much higher
priority.
Projection:
The negative repercussions of this misguided policy will be felt for years to come.
Foreign Policy:
Below average.
(+) Mr. Hariri's direct intervention was necessary to mobilize international support
during Israel's Grapes of Wrath operation in April.
(_) Except in isolated cases, Lebanon has no independent foreign policy of its own.
Projection:
Lebanon's margin of maneuver in foreign policy will continue to be hostage to the
Arab-Israeli peace process. The government should give priority to recasting Lebanese-Syrian
relations on a more equal footing.
No scorecard will be complete without assessing the record of the Hariri government
in the areas of national reconciliation and democracy-building. The rhetoric has
been good, the results dismal. This has cast a shadow on the government's other achievements. Can a government manage a complex economy when it is incapable, for example, of
producing up-to-date voter lists? Surely, a government that is in so many ways hostage
to nineteenth century technology cannot lead the country into the twenty-first century.
Footnote: [1] The government has presented to the European Union a plan which requires $1bn in aid and grants per year.
Lebanon Report Fall 1996 Index |
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