Even as Lebanon's ambitious reconstruction plan is being finalised, Lebanese government officials and business leaders are reaching out to the international investment community to put up some of the $60bn the plan is expected to cost.
While a significant portion of international investment for Lebanon's massive reconstruction programme is expected to come from the estimated 12 million Lebanese overseas, institutional investors in Europe, the US and the Far East are also being wooed. For the first time since the civil war disrupted Beirut's financial markets in the early 1980s, American and Japanese banks are returning. High-powered Lebanese trade and investment delegations are finding Western bankers' doors opening for the first time in almost two decades.
Investors are being attracted because of high returns, and the prospects for stability offered under Lebanon's long-term development plan, known as 'Horizon 2000'. That plan calls for a series of public and private sector investments to be made between 1995 and 2007, designed to make Lebanon one of the most economically and socially advanced countries in the Middle East. The government is expected to invest $18bn in infrastructure improvements, including public education and health, a new telecommunications system, and rebuilding the nation's transport system. The private sector is expected to invest $42bn over the next 12 years, in everything from Solidere (the quasi statal company charged with the reconstruction of downtown Beirut), to transport, tourism and housing sectors.
By the year 2007, the Horizon 2000 plan forecasts a doubling of national income, with the country equipped to recapture its position as the leading centre for trade and finance in the Levant.
There remains significant opposition to Horizon 2000 within Lebanon. In particular, important economic and political blocs have been upset over the brusque manner in which Prime Minister Rafiq Hariri has exercised power to promote his vision of Lebanon, relying on a small coterie of executives from his private companies to run public institutions. Hariri forced the issue in May, by resigning and then accepting re-appointment after obtaining the support of 75 of the 128 members of Parliament. This victory should assure greater political stability, providing the prime minister can build a more consensual government.
But the Hariri manoeuvre, enabling the prime minister to remove ministers opposed to his economic programme, also...