• Saturday, April 20, 2024
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BusinessDay

Lebanon’s crisis: ‘People are going to suffer, people are hungry’

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Like many Lebanese people, Yasmina had been hit by soaring food prices and shortages as her country plunged into its worst economic crisis for decades.

Now the 36-year-old chef fears that the situation is about to get far worse after a massive explosion devastated Beirut port, the main artery through which 80 per cent of Lebanon’s imports pass. At least 150 people have died and several thousand have been injured.

“People are going to suffer, people are hungry,” added Yasmina, as she walked through the badly destroyed neighbourhood of Gemmayze, where volunteers have been clearing debris from the street and from people’s homes. She added that this would further inflame public fury towards the ruling elite, who many blame for the blast.

“I really think there’s going to be violence,” added Yasmina, who did not want her full name to be published.

This weekend, protesters stormed several government buildings after a harsh crackdown by security forces on demonstrators in central Beirut. Demonstrators assembled a scaffold and noose in a central Beirut square, vowing revenge on postwar political elites who they say have robbed the country.

Food prices had already soared before the explosion — they were almost three times as high in June as they were a year earlier — and experts say it will take months to repair the damage at Beirut’s port, where the country’s main grain silo was among buildings devastated when 2,750 tonnes of ammonium nitrate exploded on Tuesday.

The UN food agency, the World Food Programme, warned this weekend that “the severe damage to the Port of Beirut could limit the flow of food supplies into the country and push food prices beyond the reach of many”. On Sunday, international donors agreed to fund emergency aid.

Lebanese authorities are hoping Tripoli port, 80km north of Beirut, can help plug the import gap. But its capacity to handle ships and containers is half that of Beirut, and business people who want to develop the port complain it has for years been neglected, in what they describe as another example of government mismanagement.

The port will probably only be able to accommodate the extra containers, at least in the short term, because the economic crisis has halved Lebanon’s imports, said Raya Hassan, ex-interior minister and former Tripoli Special Economic Zone (TSEZ) chairperson. “It’s borderline, but I think they could manage, just,” she said.

The lack of infrastructure development underscores the deep-rooted state failures that led to the catastrophe and are now exacerbating its impact.

“Suddenly, because of this huge catastrophe . . . they say we have to move quickly,” said Hassan Dennaoui, manager of the developing logistics hub next to Tripoli’s port, who complains of long neglect by the government of the port and its plans for expansion.

The project to increase the capacity of Tripoli’s logistics hub was finalised and even secured financing in 2018 — but the government failed to approve the development, according to Mr Dennaoui, who is acting chair and general manager of the TSEZ, which is connected to the port. “It shows you how this country is not really planning for anything,” said Mr Dennaoui. Mr Dennaoui says he needs $15m to put the first phase of the TSEZ’s development plan into action and expand Tripoli’s logistics capacity.

Two ships carrying wheat are currently waiting to dock, according to Tripoli port documents. But unlike Beirut, there are no silos available right at the port, said Anas Shaar, chief executive of Tripoli-based National Flour Mills.

This, he said, was the result of another missed investment opportunity — in 2013 his company proposed building “state of the art silos” in conjunction with a Swiss partner, but port authorities did not allocate land on which to build them.

In the wake of the explosion, there is still little or no warehouse capacity at Beirut’s port. The operator of Beirut’s container terminal said on Friday that it had managed to get operational two cranes for shifting containers, and “are now hopeful that normal operations could resume next week”.

“There is about 60,000 tons of excess capacity laying around” in unused grain silos across Lebanon, said Mr Shaar, who attended crisis talks with port authorities and government officials this week and said he did not “see a risk of a shortage”.

Stores are, however, low. Mr Shaar said that while the country used to have four months’ worth of wheat on hand, as a result of its dollar shortage it now only has one-and-a-half.

While Lebanon is wholly reliant on shipments for rice, sugar and flour, Michel Afram, head of the Lebanese Agricultural Research Institute, doubted shortages were imminent. “Until now we have enough stocks on the market,” he said. But he added that the disaster could “affect the price of the food”.

That price is already painfully high, driven up by a dollar shortage. Although the official pegged exchange rate is L£1,500 to the dollar, the black market rate is now L£7,000-L£8,000.

And while officials have tried to alleviate fears that the devastation to infrastructure will boost prices or lead to shortages, many Lebanese are far from convinced.

Yasmina said that even before the disaster she was being hit by the soaring costs and even shortages of some items: “triple prices for detergents, for everything. Butter, we couldn’t find for a while . . . I was making cookies with tahini, but then we found that was expensive.”

With many going hungry already, charities were already stepping in to help the vulnerable. The Lebanese Food Bank is one of the local charities providing aid to the hundreds of thousands left homeless by the blast, in the absence of a co-ordinated state response.

At the end of the day, said Soha Zaiter, its executive manager, “you cannot trust your government”.