Saad Hariri, Prime Minister of Lebanon, is moving forward with a programme of reforms and international investment to provide the country’s citizens with more stability and a better quality of life. He spoke exclusively to FORBES MIDDLE EAST about his plans for the future of the country.
In May 2018, Saad Hariri, 48, was named Prime Minister of Lebanon for the third time.
A billionaire son of one of the country’s most prominent families, Hariri has politics in his blood. His renowned father, Rafic Hariri, led the country from 1992 to 1998 as it emerged from the devastation of civil war, and then again from 2000. His tragic assassination on February 14, 2005, brought his second son to the fore.
Hariri remembers his father as a deeply honorable man. “He placed a great importance on honesty. His lesson was that in politics as in life, always be honest, it will eventually pay,” the Prime Minister told FORBES MIDDLE EAST. “I had never contemplated a political career. The assassination of my father changed my destiny in that sense.”
At that time, Hariri was a businessman and Chairman of Saudi Oger. In 2005, he stepped into his father’s role as head of the Future Movement. He admits that the transition from businessman to politician was not an easy one.
“There was a learning period during the first five years, where I was a political leader but did not run for the office of Prime Minister,” he explains. “My first term as Prime Minister in 2010 put me through another steep learning curve on how government works. In my second term that just ended, I was much more comfortable in my role.”
His first term came to an end in 2011. He won the role for a second time five years later, in December 2016. Then, in November 2017, the Prime Minister announced his resignation in a televised interview during a visit to Saudi Arabia, citing fears of an assassination plot. The shock broadcast sent ripples throughout the Middle East and the world. He rescinded his resignation a month later.
Three months into his third term, while facing significant challenges and opposition, Hariri today remains hopeful. “I look forward to forming the government to best serve my country and fellow citizens,” he insists.
FORBES MIDDLE EAST spoke to Hariri as he once again attempts to form a representative Cabinet with the strength to unite a divided Lebanon. With billions of dollars of international investment committed to the country, including loans from the World Bank and the European Bank for Reconstruction and Development, the Prime Minister is planning an intense programme of reforms designed to increase jobs and improve services and infrastructure—what he needs now is a government to lead.
In April 2018 the CEDRE Investment Conference in Paris resulted in a commitment of $11 billion in investment for Lebanon from international donors. How do you intend to use this money?
At the CEDRE conference, the government of Lebanon stated our vision based on four pillars. The first pillar is what we call the Capital Investment Programme, which is a set of infrastructure projects. Phase one is about $10-$11 billion and it covers areas in energy, water supply, wastewater, roads and transport in general. So, most of the money will be spent on the rehabilitation of infrastructure.
Lebanon’s economy has proven resilient despite the varied pressures, and Moody’s predicts modest growth of up to 3% over the next couple of years. How will the new government keep this momentum going?
The momentum will actually continue based on an expected growth of more than 5% . Moody’s made its forecast excluding the impact of the government’s vision that was presented at CEDRE.
The government of Lebanon with the IMF forecast another scenario based on the Capital Investment Programme and an attempt to diversify the sources of national income and growth. It’s going to take place through the investment in infrastructure through diversification of the sources of national income and growth. And also, through a set of reforms—be it fiscal, sectoral or structural.
Moreover, investment in the rehabilitation of Lebanon’s infrastructure will attract foreign direct investment into the country. In addition, we expect Lebanon to play an important role in the reconstruction in Syria.
We believe that the combination of all of this is going to lead to sustainability of the economy. It’s going to give it some new blood, new oxygen to take off.
Lebanon continues to feel the economic strain of hosting over a million refugees. How do you plan to face this challenge going forward?
Lebanon has over the past few years presented to the international community the impact of hosting around 1.5 million refugees. The international community has been generous and has provided Lebanon with close to $1.2 billion annually to support of the basic needs of these refugees. We believe that Lebanon needs double that amount. The government is therefore taking part of the pressure, especially in health services, education and other parts, and it is impacting our budget.
On top of that, the pressure of the Syrian refugees is felt in the increase of unemployment among the Lebanese. There is strong competition between Lebanese people and the refugees for basic jobs and services as well as in other sectors. We hope that by investing in infrastructure this will alleviate some of the pressure and provide employment for both Lebanese and Syrians. That’s how we expect to mitigate the impact of the Syrian refugees in Lebanon.
Having said this, we continue to believe that the only viable solution to the refugee issue is through their safe return back to Syria. In this context, we welcome the initiative by the Russian government and other host communities and countries to help mobilize international support for the return of these refugees.
What other plans do you have to increase job opportunities and quality of life for your citizens?
The Capital Investment Programme is the main vehicle through which we expect to generate better quality of life and higher employment. We as a government will embark on a very ambitious investment in infrastructure. This will have a duel effect.
Firstly, employment opportunities will improve, as we expect that the Capital Investment Programme is going to generate around 160 million labor days in the coming 8-10 years. Secondly, quality of life will automatically improve by improving quality services for our people.
In the last five years Lebanon has successfully built the foundations of an entrepreneurial ecosystem that supports investment in technology startups, such as through Circular 331. How much of an impact is this having on young Lebanese entrepreneurs?
Technology is affecting every sector of the global economy, and this opens up huge opportunities for young Lebanese entrepreneurs who are able to develop innovative products and services. There is a robust ecosystem supporting these entrepreneurs, with accelerators and incubators to nurture ideas, venture capital funds to give a boost of growth, and a strong network of NGOs to provide mentorship and support throughout the journey.
How much investment has been secured by these startups?
More than $180 million has been invested in technology startups in the past five years in Lebanon—an increase of less than $10 million in 2013 to more than $50 million in 2017 alone.
Lebanon has jumped from 5th place in the region in 2013 in both number and value of startup investments, up to 2nd place in 2017, behind only the U.A.E. Lebanon also has over 25 active investment institutions, which is the largest community of investors after the U.A.E. and Saudi Arabia.
Do you foresee this encouraging young expats to return to the country?
This is definitely a great reason for Lebanese diaspora to come back to the country. Lebanon has all the advantages to be the region’s top technology hub. From a strong base of creative and technology talent, to an active investor community and support ecosystem, to a culture that encourages and values the entrepreneurial spirit.
With success stories like Anghami, one of the region’s most valuable startups, there are great role models showing that technology entrepreneurs can build businesses from Lebanon that reach regional and global heights.
What should business leaders be doing to help to fight corruption in Lebanon?
Lebanon does suffer from a high level of corruption, and while we believe that sometimes it has been over exaggerated, it continues to be a major problem.
We hope and expect that the set of reforms we presented to the CEDRE conference will deal quite a lot with the problems of better efficiency and less corruption.
In this context, there are many initiatives underway in parliament, such as developing the e-government, implementing structural and sectoral reforms, making improvements to the way we do business, and at the same time encouraging the involvement of the private sector in the provision of services to Lebanese citizens.
The combination of all this, we believe, will help tremendously in fighting corruption.
As you set about forming your new Cabinet, what are your key priorities in terms of representation and how do you hope to inspire the people of Lebanon through the new government?
My key priority is to form a national accord government where the major parliamentary blocks are represented. My aim is to lock a consensus in the Cabinet for the quick and transparent execution of the investment and reform program, for the first phase of which we secured financing at the CEDRE conference in Paris.
How do you hope to work with other Gulf states to bring about peace and economic stability for Lebanon and the wider region?
Lebanon has always enjoyed privileged relations with the GCC states. They have been essential for the rebuilding of our country after the civil war, and they are vital for our economy. Hundreds of thousands of Lebanese work there, and their remittances make a sizeable portion of our GDP. Their citizens are foremost in terms of tourists and investors in Lebanon.
Our government adopted in December 2017 a resolution of dissociation and non-interference in Arab quarrels and internal Arab affairs. We are committed to build on this resolution to maintain and improve our ties with them.
What makes you most proud of your country?
I have many reasons to be proud of Lebanon, but I am perhaps proudest when I meet young Lebanese men and women and feel the energy, creativity and skills they have.
They are my hope, and they are the hope of Lebanon for a better future.