Lebanon's Economy and Sustainable Job Creation in the Middle East

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1) "The thing about Lebanese migration, unlike other types of migration, is that some statistics show that we have around 75 percent of migrants who have more than a graduate diploma (or a university and a graduate diploma). So, it is typically high-skilled migration. This is why the Lebanese will not immediately return to Lebanon. What we read in the media, especially in the local media, was a bit inflated regarding this issue…What we are witnessing is that when there are jobs that are being lost for some project in the Gulf, the Lebanese are going somewhere else and not returning immediately to Lebanon. This is due to their high skill level and their experience, so they can recycle very quickly in the labor market. Some have been going to other emerging markets like Northern Iraq, some countries in Africa – like Nigeria, Algeria, or other countries – and some have been migrating to Europe or the U.S. We are seeing a phenomenon called “circular migration,” where the Lebanese that went to the Gulf now are migrating to the EU, North America or even Australia. The number of Lebanese going back is, in my opinion, very little, because those who migrated are highly skilled and are searching for very high wages that are not available in Lebanon. Even if there are opportunities created in the market, the local market, these migrants probably would not accept the wages due to their high expectations."

2) "Lebanon avoided the financial crisis. We haven’t had any bank collapsing or any bank losing major assets, especially on the global financial markets…Just to give you a number: bank deposits are above 300 percent of GDP, which is an exceptional number. The banks in Lebanon are managing a huge amount of money that is deposited, and they are contributing to basically managing inflows and outflows of capital, especially remittances. In a country that relies so much on migration and on foreign transfers, you had to have a good banking sector. This is why it is a strong sector. Also, a major aspect is that it is very strongly regulated. The regulation in Lebanon for the banks is driven by the Central Bank and many banking commissions and regulatory authorities – there are five. Now, this is kind of cynical, in Lebanon we have had so many crises and so much instability that the regulators became used to this unstable environment. This is why, when we had this economic crisis now, the banks in Lebanon emerged very stable because, you can say, they are used to it."

3) "…Employment in the public sector already is creating a big liability in terms of salaries and employment benefits and, most importantly, retirement. You know, when they employed so many people in the past, this will impose a very big pension pressure on the government. We are seeing this in collapsing social security systems in Egypt, Lebanon and Syria: all the countries are facing severe pressures on social security. What is happening is that the government cannot really continue doing the same “business as usual,” and they are trying to rely on the private sector for ideas and initiatives. This is working in some countries, like Jordan, where there are some initiatives that are bringing jobs to young graduates, but the problem we are seeing is that there is too much imitation and very little coordination among countries. So each country wants to create, or wants to attract, investors in information technology (IT), in tourism, even in health care and we are being told of competing where Dubai would compete with Amman, Amman would compete with Beirut, Beirut wants to compete with Damascus; there is too much imitation and very little coordination."

4) "At the same time, there are sectors that can create jobs that have not really been put on top of the agenda. Especially in areas like sustainable development, alternative energy, and also areas that are pertaining to agro-food production, and especially the water sector. The region is facing tremendous challenges in terms of its food security, and there are many resources that are untapped, especially using water projects or massive public works projects to create some kind of infrastructure for better agro-food industries. So, giving tax breaks for investments in these sectors, putting some money toward research and development to create more production ideas for these industries, and also reducing trade barriers and movement barriers for entrepreneurs, and especially young people, in the region."

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