Private Roundtable Discussion with Dr. Alain Bifani, Director General of the Ministry of Finance

 

The Middle East Institute and the Safadi Foundation USA
are pleased to host a private off-the-record roundtable discussion with:

Dr. Alain Bifani
Director General of Lebanon’s Ministry of Finance

Friday, October 7, 2016
12:00-1:00 PM

The Middle East Institute
1761 N Street, NW
Washington, DC 20036

Speaker Biography:

Alain A. Bifani, Ph.D, has served as Director General of the Ministry of Finance of Lebanon since 2000. Throughout his tenure, he has managed public expenditures, debt, Eurobond issuances, and the full range of monetary policy tools, while also leading the modernization of the ministry’s organizations and operations. He led Lebanon’s economic and financial planning in response to the Syrian refugee crisis. He also developed the national reform agenda encompassing re-distribution and tax policies, enhancement of the social safety net, and policies to spur growth, infrastructure investment, employment and a sound financial system. On behalf of the ministry he has worked with the parliament in the drafting and implementation of numerous major laws treating national and personal finance. Prior to entering government, Dr. Bifani held leadership positions in banking, accounting, financial consultancy, and sovereign financial rating.

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Lebanon’s Municipal Elections: Prospects for Reform

The United Institute of Peace and the Safadi Foundation USA
present:
 Lebanon’s Municipal Elections: Prospects for Reform
 
Lebanon is slated to launch a series of municipal elections on Sunday May 2, 2010.  The briefing will address the expected results and the role the elections play in Lebanon’s overall political transition.  The discussion will highlight the status of political reforms and ways the United States can move forward in supporting democracy promotion efforts in Lebanon.
 
Please join us for a discussion with:
 
Elias Muhanna, Blogger, QifaNabki.com and Political Analyst.
 
Joe Hall, Resident Country Director (Lebanon), National Democratic Institute
 
Moderated by: Mona Yacoubian, Director, Lebanon Working Group, United States Institute of Peace (USIP)
 
Friday, May 7, 2010
2:00 PM-3:00 PM
Rayburn House Office Building
Room 2255
 
Please RSVP HERE
 
Please contact Leslie Thompson (lthompson@usip.org) if you have any questions.
 
Safadi Foundation USA is a non-partisan registered 501 (c) (3) public charitable tax-exempt organization dedicated to promoting a national and strategic framework for Lebanon’s development.
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Lebanon: Is Real Reform Possible?

The Middle East Program of the Woodrow Wilson Center and
the Safadi Foundation USA
Present:

Lebanon: Is Real Reform Possible?

(Click here to watch video)

with
 MOHAMMAD A. SAFADI

Minister of Economy and Trade and Member of Parliament, Republic of Lebanon

Domestic reforms are critical to ensuring Lebanon’s long-term independence and sovereignty.  Will the Lebanese government be able to strengthen the institutional framework that is required to expand economic opportunity and break down the clientelist structure of the Lebanese state?  Minister Safadi will address the current situation on the ground and outline specific steps to move the reform process forward.
Wednesday, March 10, 2010
11:00 a.m. – 12:00 p.m.
6th Floor Flom Auditorium
Woodrow Wilson Center
_____________________________________________________________
Please RSVP to mep@wilsoncenter.org or fax 202-691-4184
Name and Title:
Affiliation:
E-mail:
Seating is limited. Seats are available on a first-come, first-served basis.
A photo ID is required for entry.
The Woodrow Wilson Center is located in the Ronald Reagan Building (Federal Triangle stop on Blue/Orange Line). Public parking is available underneath the Reagan Building; however we recommend metro or taxi.  www.wilsoncenter.org/directions
Safadi Foundation USA is a non-partisan registered 501(c)(3) public charitable tax-exempt organization dedicated to promoting a national and strategic framework for Lebanon’s development.
  
 

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New Media and Reform in the Middle East: The Case of Lebanon

The Safadi Foundation USA and the Project on Middle East Democracy (POMED) present:

New Media and Reform in the Middle East: The Case of Lebanon

 

The year 2009 witnessed an explosion of Internet-based activism in the political cultures of the Middle East. From the so-called Iranian “Twitter Revolution,” which helped Green Movement activists mobilize and organize their protests on the streets of Tehran, to the recent imprisonment of prominent bloggers in Egypt and other countries, the Internet has finally become a force to be reckoned with in Arab politics.
The use of information and communication technology (ICT) in the Middle East has been a trans-formative tool in strengthening civil society and expanding the outreach of independent voices.  In her remarks concerning Internet freedom last month, Secretary Clinton noted the power of the Internet and new technologies in helping to bridge divides between people of different faiths and help expand dialogue.
What types of U.S. assistance are needed to empower young reformers committed to non-sectarian politics?  What is the role of ICT in promoting inter-faith dialogue and peace building?  Can ICT help organize young voters in advance of the upcoming municipal elections?  What is the direction of new media training in Lebanon?
Please join us for a discussion with:
Jared Cohen, Policy Planning Staff, U.S. Department of State
Elias Muhanna, Blogger, QifaNabki.com
Moderated by: Mona Yacoubian, Director, Lebanon Working Group, United States Institute of Peace (USIP)
Friday, March 5, 2010
11:00 AM
Rayburn House Office Building
Room 2255
Please RSVP by email to: rsvp@pomed.org
Safadi Foundation USA is a non-partisan registered 501 (c) (3) public charitable tax-exempt organization dedicated to promoting a national and strategic framework for Lebanon’s development.
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Elections in Lebanon: Mapping Alliances and Managing Expectations

Elections in Lebanon: Mapping Alliances and Managing Expectations

 

On Monday, April 27, 2009, Safadi Foundation USA hosted a briefing in cooperation with the Middle East Program of the Woodrow Wilson Center, entitled “Elections in Lebanon: Mapping Alliances and Managing Expectations.”

The panel was moderated by Haleh Esfandiari, Director of the Middle East Program at the Wilson Center. Panelists included: Ambassador C. David Welch, Former Assistant Secretary of State, Near Eastern Affairs; Paul Salem, Director, Middle East Center, Carnegie Endowment for International Peace; andKarim Sadjadpour, Associate, Middle East Program, Carnegie Endowment for International Peace.

The discussion focused on the significance of the upcoming parliamentary elections scheduled for June 7, 2009. The panelists confirmed that while the upcoming elections are important as far as Lebanon’s political future is concerned and have certain regional implications, they will not bring about widespread unexpected changes in Lebanon’s political representation and national identity. As Ambassador Welch noted, “This election is going to be decided in a few key districts…in particular the Christian districts.”

The widespread attention on the elections from the United States and the international community is critical to express support for both reform in Lebanon and for civil society’s important role in the democratic process. Paul Salem commented “…that already there is some change in the electoral system.But also, that if these elections, the reforms, the Minister of Interior and the autonomous commission established to oversee the campaigning do well, it will open the door for further discussion of electoral reform in Lebanon.”Specifically, the success of a continued reform effort in Lebanon will break the limitations imposed by the traditional clientalistic structure and introduce new possibilities.

For more please click on the following link to view the event in its entirety:
http://www.wilsoncenter.org/index.cfm?topic_id=1426&fuseaction=topics.event_summary&event_id=518980

You can also view the reaction by the Beirut based Daily Star at:http://www.dailystar.com.lb/article.asp?edition_id=1&categ_id=2&article_id=101432

Highlighted Quotes:

“The U.S. really has a policy that can be described as pro-Lebanon; it is not associated or derived from any other regional policy…the new Administration does recognize Lebanon as unique…it does see it as a priority to be protected and advanced and that it will put it in a key position in this new pattern of regional engagement that this new Administration appears to be offering.” C. David Welch

“This election also contains the beginnings of reform. It’s an election law that was put in place after the National Commission was formed. Some of the reforms that were suggested were adopted in parliament. These reforms are the first reforms introduced into the Lebanese election law since 1927.” Paul Salem

“There shouldn’t be a Sunni policy in Lebanon, a Shi’ite policy, a Druze policy…it should be a pro-Lebanon policy.” Karim Sadjadpour

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Lebanon: Economic Highlights

SAFADI FOUNDATION USA
Economic Highlights from Lebanon
September 2012

Introduction

In an effort to promote information on governance priorities in Lebanon, the Safadi Foundation USA has compiled the following summary on current economic challenges and reforms in Lebanon based on official sources provided by the Ministry of Finance (MoF) and meetings with leading economists and bankers in the country. This document attempts to highlight some of the major activities taking place right now, and in no way does it seek to detail Lebanon’s economic and financial intricacies.  In addition, background materials on Lebanon and the economic situation are attached for those that would like to take a more in depth look.

Summary

Lebanon is mainly a service-based economy with the real estate, trade and tourism sectors as its main drivers.  In addition, the financial sector comprising banking and insurance is an integral part of Lebanon’s economic resilience and stability.  Lebanon’s banking system is large in comparison to the size of its economy (deposits to GDP ratio hovers around 300%).  It constitutes the backbone of the economy and was shielded from the global financial crisis due to its conservative policies.  Hence, it was able to continue increasing credit to the private sector despite a declining trend in this area internationally and despite regional instability.  Overall, banking loans to the private sector have increased by 12% in the first half of 2012 and subsidized loans from the MoF have also increased by more than 30% in 2011.

Although progress is being made with a growth rate of 3%, Lebanon’s economy continues to face significant pressure.  The global financial crisis as well as revolutions, transitions and continuing protests in the Arab region have been additional sources of stress on Lebanon’s economic potential.  Furthermore, domestic tensions as a result of the crisis in Syria are also a major strain on Lebanon’s economic stability.  Despite having withstood these pressures thus far with a positive growth rate, Lebanon continues to find itself in fragile and uncertain territory that makes maintaining macroeconomic stability challenging for any country in this environment.  In light of these challenges, a core-team of dedicated public servants continue to work on implementing domestic policies that seek to enhance the delivery of public services to Lebanese citizens and create an environment that is conducive to growth.

Current Economic Highlights

Some initiatives underway in Lebanon’s public sector that aim to reduce fiscal vulnerabilities, improve transparency and accountability, and promote economic growth and financial stability are:

Reducing Fiscal Vulnerabilities

The MoF is making every effort to maintain financial stability and maintain government debt on a declining trend.  The debt to GDP ratio has declined from its peak of around 180% of GDP in 2006 to reach around 135% by the end of 2011.  This has been accompanied by a change of debt composition from an equal split of 50% between foreign and domestic debt to a composition more skewed towards domestic debt by the end of 2011 (61% domestic debt).
The fiscal deficit has declined to 6% of GDP by the end of 2011 compared to 11.7% five years earlier.  At the same time, the primary surplus to GDP ratio also reached an all time high of 3.4% in 2011, improving from 0.9% in 2007.
The activation of the Public Debt Directorate within the MoF with the assistance of EFMIS (Emergency Fiscal Management Reform Implementation Program with the European Union) will build the capacity of the Ministry to manage the public debt and positively contribute to the macro policy framework.  The office has set out a five-year strategy to analyze and manage the public debt and reduce risks.  A sound debt policy will reduce Lebanon’s economic vulnerabilities from internal and external shocks.  In addition, by establishing the right infrastructure within the ministry an exit strategy for UNDP is underway and will improve overall sustainability.

Improving Transparency and Accountability

Lebanon has not had a reliable accounting system since the end of the civil war in 1990, and has lacked audited accounts with accurate figures.  The MoF is in the process of producing and auditing all government financial accounts from 1993 to this date.
One of Lebanon’s primary challenges is the delivery of services to citizens.  The continued restructuring of the tax administration by the MoF towards a function-based structure will modernize the tax system and promote reliable services to citizens. This effort has been underway in previous governments and is being pursued and further developed under the current one.
Lebanon’s national priorities need to be better reflected in the national budget process.  The Macro Fiscal Unit within the MoF is undertaking important reforms that will link the vision of the government with what is presented in the budget through the adoption of the IMF Government Finance Statistics (GFS) 2001 classification system.  This is an internationally recognized budget classification system that was adopted by the current MoF.  This shift will enable the organization of data to better meet reporting requirements and provide a more detailed analytic understanding behind the numbers helping to bridge the gap between the budget and national priorities.
Each Ministry within the Government of Lebanon is responsible for producing and submitting a budget.  Given the lack of cohesive guidelines for ministries to follow, it has not always been a transparent and/or efficient process.  Efficiency in the budget-making process is now being boosted on an operational level with the introduction of a manual to assist ministries in the budget preparation process.  Additionally, all budgets are now expected to be posted online in the third quarter of 2012.
Corruption and inefficiencies in government institutions are a common complaint by citizens.  One way the MoF is seeking to address this deeply rooted problem and improve the transparency and accountability in citizen-government relations is through E-Government.  The MoF launched in August 2012 its first on-line e-government service which allows citizens to log onto its website and check their outstanding payments that are due in relation to built-property tax.  This initiative is a first step towards a more robust comprehensive reform plan based on the provision of online service to citizens.  As of September 1, 2012, taxpayers were also granted the right to register with the MoF and secure their online user names and passwords allowing them to check other items of outstanding taxation due, which include VAT, income tax and built-property tax.  In a follow-up step, which is expected to be launched by first quarter of 2013, citizens may pay taxes or other forms of fees through e-payment gateways through their banks or through online payments using credit cards.  Beginning in 2013, citizens will also be able to submit their VAT declarations on-line.  The same initiative may be translated to other Government bodies including Customs and other line Ministries that provide direct services to citizens.

Promoting Economic Growth and Financial Stability

Lebanon’s entrepreneurial spirit is strong.  In fact, three of the five selected Arab Innovators selected by MIT’s Technology Review “TR 35” came from Lebanon.  However, despite this strong determination and creativity by young Lebanese there is little financial support by way of equity funding.  The MoF is addressing this challenge and is in the final phases of negotiating a $30,000,000 loan from the World Bank, which is in the final negotiation phase.  The loan aims to establish and finance a funding facility (Innovation in SMEs – iSMEs fund) to stimulate innovation by entrepreneurs and increase the availability of equity investments for young, growing firms. This type of public involvement in equity funds and grants for businesses is a tested model used by many governments as a means of supporting a funding gap in the market.  In addition, this will generate a more robust risk-taking culture, stimulate entrepreneurship, and, over time, enhance the potential for additional private sector jobs.
Despite the unstable regional environment, the MoF has succeeded, since August 2011, in completing in the market new issues and exchanges of Eurobonds amounting to more than $5 billion.  The issues have all been many times oversubscribed, including by international investors.  The maturities of the new Eurobonds ranged between 5 and 15 years, with coupon rates varying between 5.0% and 6.6%, which are significantly lower than borrowing rates by many European countries.
In August of 2011 the GoL established a legal and regulatory framework through the legislation of Law No. 161 on Financial Markets.  The creation of an autonomous Capital Market Authority will boost economic growth and contribute to financial stability by organizing financial markets in a more transparent manner that will ultimately reduce risks and promote domestic and foreign investments.

Recommendations

Safadi Foundation USA strongly supports FY2013 State and Foreign Operations Appropriations report language that “urges the Department of State to focus assistance for Lebanon on efforts that promote transparency, strengthen financial management, and improve efficiency of government institutions.”  In addition, Safadi Foundation USA recommends the following guidelines for helping to improve Lebanon’s fiscal environment.  These measures will help restore and strengthen citizens’ confidence in state institutions and will enable the Government of Lebanon (GoL) to be more efficient in the delivery of public services.

Donors are encouraged to support the GoL to:

Legislate the passage of a budget that reflects the national priorities of the country and for a full implementation of the budget law;
Urge the State to recover all illegal occupied public properties;
Enforce the protection of individual property and rule of law by forcing illegal occupants of private properties to dismantle their built properties, thus protecting individual property and imposing the rule of Law;
Move forward on an Access to Information legislation that will open the space for a more transparent and democratic society.  For more on this issue please visit http://www.transparency-lebanon.org/index.php?option=com_content&view=article&id=23&Itemid=122&lang=en; and
Embrace the concept of Public Private Partnerships (PPPs) and legislate a PPP law.  PPPs are a great way for the public sector in Lebanon to improve infrastructure that is estimated to cost around $20 billion.  By paving the way for the private sector to participate, Lebanon can avoid huge economic burdens and ensure that the best quality and competitive services will be delivered to the people since it will be the private sector that carries the cost of the risks.

Donors should continue to support a stable Lebanon by:

Supporting Lebanon’s ability to maintain internal security and working to ensure a peaceful regional environment.  All of Lebanon’s industries depend on this stability to thrive.  Instability caused by recent regional turmoil has led to a significant drop in Lebanon’s tourism sector;
Directing assistance in the area of democracy and governance to both civil society and government institutions; and
Assisting the GoL to make sure proper mechanisms are in place for the proper handling and oversight of any revenues from natural gas reserves off the coast of Lebanon.  Lebanon’s energy sector, specifically electricity is rife with corruption and is one of the largest sources of frustration by citizens.  Every precaution should be taken not to duplicate these same inefficiencies.



Additional Background Info

Official Documents:

Lebanon Country Profile Report 2011 – MoF
http://www.finance.gov.lb/en-US/finance/ReportsPublications/DocumentsAndReportsIssuedByMOF/Documents/Sovereign%20and%20Invensment%20Reports/Country%20Profile/Lebanon%20Country%20Profile%202011.pdf

Public Finance Annual Review
http://www.finance.gov.lb/en-US/finance/ReportsPublications/DocumentsAndReportsIssuedByMOF/Documents/Public%20Finance%20Reports/Annual/YR_2011.pdf

Articles:

“Oil and Gas: Cure or Curse? The Conundrum of Lebanon’s Hypothetical Hydrocarbons,” Zac Brophy, in The Executive, February 6, 2012.
http://www.executive-magazine.com/getarticle.php?article=15118

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Recommendations for Lebanon’s New Government

Recommendations for Lebanon’s New Government 

 

Prime Minister designate Saad Hariri submitted a thirty-member Cabinet line-up to the President of the Lebanese Republic today.  The new government will now prepare a policy statement to be presented to the Parliament for a vote-of-confidence.  Safadi Foundation USA believes the formation of a Cabinet in Lebanon presents an opportunity to advance Lebanon’s development and build support for state institutions that will ensure Lebanon’s true independence and sovereignty.  “The Lebanese parliament should immediately assert its role as a center for national debate and dialogue and begin to constructively engage youth and civil society in an effort to abolish confessionalism, accelerate administrative decentralization and spread a culture of peace in accordance with the Taif Accord,” said Lara Alameh, Executive Director of Safadi Foundation USA.  Reforms are necessary to ensure Lebanon’s independence so that it is not vulnerable to external influence and regional relationships.

The following benchmarks outline recommendations for the Government of Lebanon in the areas of political reform, civil society and education.  The donor community should support these reforms for a more sustainable development in Lebanon:

Political Reform

Electoral Law: In light of recent parliamentary elections and the upcoming municipal elections, the government of Lebanon should give new life to the establishment of a revised electoral law that includes additional reforms not yet passed.  Specifically, the President should designate an independent and nonpartisan Committee to reaffirm the findings of the Boutros Commission and outline a set of recommendations for parliament to implement in advance of the 2010 municipal elections.

Decentralization: The Government of Lebanon is working with local and regional councils to draft a decentralization law to be debated and passed by Parliament.   The Government of Lebanon should request assistance and resources from the donor community to help draft a modern decentralization law that would be adopted for the Lebanese case and would not threaten any of its communities.  Additionally, donors should work with current municipalities to provide them with technical and infrastructure related assistance needed to implement administrative reforms.  A certain percentage of budget support to the Government of Lebanon should be based on conditionalities to disburse that aid to the municipalities.      

Capacity Building: Lebanon’s ministries face serious governance challenges.  Most positions reflect the confessional design of Lebanon’s political institutions and acute levels of patronage.  The donor community should help the government of Lebanon build a culture based on meritocracy through expanding training and technical support programs for individual Ministries.  These programs will help raise the quality and knowledge of people within the government.   Programs should include increased pay for public sector positions, which are approximately sixty percent less than private sector positions.  Donor countries should coordinate their efforts to sponsor reform in Ministries that demonstrate leadership at the Director General and/or Ministerial level. 

Civil Society

Donor Assistance: Currently, mechanisms for oversight of donor funding in Lebanon are limited.  The Council for Development and Reconstruction (CDR) and the High Relief Committee (HRC) are not long-term solutions to addressing Lebanon’s development needs as they do not address Lebanon’s national needs in a comprehensive manner.  Oversight of all donor assistance in Lebanon needs to be expanded to include appropriate parliamentary committees, local and regional representatives and increased community participation.  The Government of Lebanon should establish a Ministry of Planning and International Cooperation in order to coordinate donor assistance and ensure that donor projects are in line with national strategies.  

Capacity Building:  Lebanon has many registered NGOs from smaller towns and villages who do not benefit from international donor funding because they do not yet have the technical know-how or the support of a donor network to apply.  Larger Lebanese NGOs should use their experience and expertise to reach out to smaller NGOs and form partnerships to help them build their capacities. 

Education

Youth:  Lebanese youth face high rates of unemployment, violence, school dropout, delinquency, and emigration. These youth should be taught skills to enhance their job prospects such as training in entrepreneurship, English language, and information technology.  In addition, peace-building programs that promote tolerance and cross-confessional dialogue should continue to be implemented.  The Government of Lebanon should formulate economic policies that focus on job creation for youth and encourage college graduates to remain in the country.

Civic Participation:  The political system and public administration are over centralized, mostly corrupt, and inefficient; the lack of meritocracy has limited citizen participation, particularly of youth.  Civic Education that features concepts of citizenship, good governance, and public participation in the democratic process should be standardized in all schools.  Enhancing citizen participation on a municipal and regional level will help break down traditional barriers and improve the efficiency and authority of the central government throughout the country.  Citizen awareness campaigns should continue to be implemented at the local level.

Environment:  Lebanon faces severe environmental issues ranging from desertification and clean water to the endangerment of the famed cedars.  These issues transcend confessional lines and if they are not solved can lead to future conflict.  Civil society and local and national governments should promote public awareness about the consequences of poor environmental policies and practices.

 

Safadi Foundation USA is a non-partisan registered 501 (c) (3) public charitable tax-exempt organization dedicated to promoting a national and strategic framework for Lebanon’s development.

 

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