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Pitfalls in Sending Aid to Lebanon     08/09 10:25


   BEIRUT (AP) -- Hospitals and schools, then shattered and bent water pipes, 
then the crater that once was Lebanon's port.

   The rebuilding needs of Lebanon are immense, but so is the question of how 
to ensure the millions of dollars promised in international aid is not diverted 
in a country notorious for missing money, invisible infrastructure projects and 
its refusal to open the books.

   And the port --- the epicenter of the explosion that shattered Beirut, the 
center of Lebanon's import-based economy, and a source of graft so lucrative 
that Lebanon's political factions were willing to divide its control so 
everyone could get a piece --- sits at the heart of the fears.

   Sunday's donor teleconference is hosted by French President Emmanuel Macron, 
who was mobbed last week by tearful victims of the Beirut ammonium nitrate 
explosion begging him to ensure the corruption they blame for the blast that 
devastated the capital does not profit from its destruction.

   International diplomacy usually calls for careful language. Rigged votes are 
"irregular." The response to furious protests should be "measured." 
Disappearing funds require "transparency."

   But Macron's response to the crowd, and later in a speech in Beirut, was 
unusually blunt: The aid "will not fall into corrupt hands" and Lebanon's 
discredited government must change. Germany, Lebanon's second-biggest bilateral 
donor, made similar demands.

   "That's precisely what the Lebanese people have rightly demanded: individual 
interests and old lines of conflict must be overcome and the welfare of the 
entire population must be put first," German Foreign Ministry.

   In the short-term, the aid streaming into Lebanon is purely for humanitarian 
emergencies and relatively easy to monitor. The U.S., France, Britain, Canada 
and Australia, among others, have been clear that it is going directly to 
trusted local aid groups like the Lebanese Red Cross or U.N. agencies.

   "Our aid is absolutely not going to the government. Our aid is going to the 
people of Lebanon," said John Barsa of USAID.

   But actual rebuilding requires massive imports of supplies and equipment. 
The contracts and subcontracts have given Lebanon's ruling elite its wealth and 
power, while leaving the country with crumbling roads, regular electricity 
cuts, trash that piles on the streets and intermittent water supplies.

   "The level of infrastructure in Lebanon is directly linked today to the 
level of corruption," said Neemat Frem, a prominent Lebanese businessman and 
independent member of parliament. "We badly need more dollars but I understand 
that the Lebanese state and its agencies are not competent."

   Lebanon has an accumulated debt of about $100 billion, for a population of 
just under 7 million people --- 5 million Lebanese and 2 million Syrians and 
Palestinians, most of them refugees. Its electricity company, controlled like 
the port by multiple factions, posts losses of $1.5 billion a year, although 
Frem said most factories pay for their own generators because power is off more 
than it's on.

   "There's grand theft Lebanon and there's petty theft Lebanon. Petty theft 
Lebanon exists but that's not what got the country in the hole we're in," said 
Nadim Houry, executive director of the Arab Reform Initiative.

   Prior aid, Houry said, ended up as a tool in the hands of the political 
leaders, who kept their slice and doled out jobs and money to supporters.

   "The pie is getting smaller and smaller and they just keep taking," he said.

   Protesters, tired of the small indignities they endure to get through a day 
--- 37% of people report needing to pay bribes, compared with 4% in neighboring 
Jordan, according to Transparency International --- and the larger issue of a 
collapsing state, are going after both.

   On Saturday, they seized offices of the Economy Ministry, hauling away files 
they said would show corruption around the sale and distribution of wheat. 
Lebanon's wheat stockpile, stored next to the warehouse filled with ammonium 
nitrate, was destroyed in the explosion.

   "We restored the economy ministry to the Lebanese people," one man called 
out as they rifled through the desks.

   Julien Courson, head of the Lebanon Transparency Association, said the 
country's non-profits are forming a coalition to monitor how relief and aid 
money is spent. He estimated Lebanon loses $2 billion to corruption each year.

   "The decision-makers and the public servants who are in charge of these 
files are still in their positions. Until now, we didn't see any solution to 
the problem," he said. "I think the Lebanese government has an interest in 
finding a suitable solution."

   A first step would be an online clearinghouse for every contract linked to 
reconstruction, Courson said. And the first project has to be highly visible 
and spread the benefits widely, said Christiaan Poortman, board chairman of 
Infrastructure Transparency Initiative.

   "That will help keeping some of the political stuff at a distance," Poortman 
said. "Donors will have to be on top of this. The issue of procurement is 
always where lots of corruption takes place ... it needs to be done quickly, 
and there is always the temptation to not follow the rules and go ahead and do 
something where a lot of people are going to make a lot of money."

   Macron's office said international donors can do nothing until Lebanon's 
leaders agree to an audit of the national bank, a key demand of the 
International Monetary Fund for months and one that the political factions have 

   Speaking at a news conference in which he conspicuously did not appear 
alongside Lebanese President Michel Aoun, Macron said he was approaching 
Lebanon with "the requirements of a friend who rushes to help, when times are 
hard, but not to give a blank check to systems that no longer have the trust of 
their people."

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