Posts Tagged ‘Fabrice Balanche’
Reconstruction of Beirut city center? Like Solidere? By whom again?
Posted by: adonis49 on: February 20, 2013
Reconstruction of Beirut city center? Like Solidere? By whom again?
Solidere (Societe Libanaise de Reconstruction) is a chartered company in charge of reconstructing and managing the city center of Beirut. The concession was supposed to be valid for 25 years, and Fouad Seniora PM extended the permit for 75 years in November 2005. Seniora was the right hand of late Rafic hariri PM who was assassinated on Feb. 14, 2004.
This private company owns a third of the city center or (108,000 sq.metres). In Sept. 2010, a year after taking office, Saad Hariri PM (son of Rafik) took private possession of 30,000 sq.metres of downtown Beirut and paid for by Solidere.
Solidere was created in 1992 with the total backing of Saudi Arabia and the blessing of the financial neoliberal decision-makers in the US.
Through figure heads, Rafik Hariri gathered the majority of the shares.
Destroyed and badly damaged properties in the city center were expropriated under dubious circumstances and bought judges and ther controlled municipality of Beirut, and the owners of the properties were compensated by shares in the company.
The trick is that Rafik manipulated the stockprices and bought shares at ridiculous prices from panicked shareholders.
What Solidere does?
It sells and rents apartments and offices that guarantee huge profits. How?
1. Prime Lands were acquired virtually for free,
2. The cost of construction was minimal due to cheap Syrian work labor,
3. The investment in infrastructure was mostly done by public money,
4. Public money were poured in the Hariri contracting firms, and at inflated cost estimates
5. The side public institutions related to finance, reconstruction, and internal security… were attached directly to the Prime Minister (Rafik Hariri)
6. The former shopping centers and areas such as Hamra Street and Achrafieh were totally neglected for several years so that the city center attracks all the traders and banks andforeign multinational companies…
7. The network of urban highways and tunnels mainly served the city center to encourage companies to relocate to Solidere Real Estates
8. The airport was 15 minutes away and the seafront less than 5 minutes far, and the city center was located in the main axes to enter and leave Beirut…
9. The prime land of Ouzai district, an extension to Beirut’s seafront of luxury hotels, was inhabited by southern Moslem Shiaa, refuggees from the civil war, and they refused to vacate this district.
The planned Alissar luxury project was blocked temporarily.
Hariri undertook to have a highway run through Ouzai in order to have a legal leverage to pressure the people to leave, and he failed.
If Hariri had the best interest of the people in mind he would have built a flyover express highway as the one crossing the Armenian district of Burj Hammoud in East Beirut. And the highway to the south is detached in several places because of the rapacious personal interests of the Hariri clan.
Building permits in this lucrative city center, if the projects do not get a go by the Hariri oligarchy, are routinely blocked by Beirut municipality, totally in control of the Hariri clan. And the Hariri clan can side step regulations on urban development to match their interests and the Saudi princes and Emirs of the Gulf…
For an entire decade (1992-2002), Lebanon was run by a triumvirate of Rafik Hariri PM, President Hrawi, and Chairman of parliament for life Nabih Brrri, with the total backing of Syria, saudi Arabia and the USA administrations.
The Lebanese chapter of Transparency International has abundant substanting documents on this matter. The chapter wrote:
“As a result of this arrangement, late Hariri became the sole decision-maker on the reconstruction process of the city center, Nabih Berri (chairman of the parliament for life) was given the charge of the reconstruction and relief programs for south Lebanon. Walid Jumblatt, the Druze warlord was given the relocation of refugees Box, and president Hrawi was interested in the oil and gas sector…”
After the failed preemptive war of Israel in June 2006, the opposition coalition put the pressure on the Seniora government to desisit from its oligarchic policies. They set up tents in the city center for 16 months (Oct. 2006 to May 2008). a sit-in symbolizing the exclusion of the people’s re-appropriation of their city center
As a result, investors shifted their interests to Ashrafieh and Hamra Street. The Hariri clan was taken aback and lost vast amount in profits.
Solidere considered moving its wealth to Jordan, in the Al Akaba, Red Sea seafront, to invest in the vast luxury contracting project of the elder son of Rafik Hariri.
The neoliberal expatriate wealthy class forced on this pseudo-State over $70 bn in debt that Lebanon didn’t need so that they satisfy quick wealth to all the warlords and their clientelist political sectarian bases.
The irony is that this neoliberal system is stating that the first $30 bn generated from the potential gas and oil offshore extraction will go to servicing the debt.
They never learn from previous experiences of other States who opted to default and are now well grounded on their feet and prospering.
Note 1. In the Middle-East, the relatioship between political regimes and space is based on political patronage. A city is a place of power to control the space and influence the central government.
This reconstruction project is viewed by the elite classes (foreigns, expatriates, and local bank owners…) as success story. It is viewed as a striking failure by the Lebanese in resolving unstable social and political class-divide.
Note 2: This urban planning of Beirut city center is inherited by the recent Arab Gulf Emirates Real Estates development programs (Dubai…) with the explicit purpose of attracting foreign investment… This project wanted the Lebanese to believe that “neoliberal globalization” will save Lebanon from its endemic insecurity from its regional enduring conflicts (Israel, jihhadist…)
Note 3: Article inspired from a chapter by Fabrice Balanche in the book “Lebanon After the Cedar Revolution“
Expatriate Contractor Class managing the contracted national debt in Lebanon… How Neo-Liberalism is applied in your country?
Posted by: adonis49 on: February 18, 2013
How Neoliberal expatriate Contractor Class is managing the contracted national debt in Lebanon?
How neoliberalism is applied in your country?
Neoliberalism is not a difficult concept to comprehand: Just observe its applications and consequences on your survival instinct.
The best way to understand neolibralism in the western developed nations is to witness how developing States are applying it.
Particularly, new small States recognized in the UN that were under direct mandated powers for many decades, and now are appeasing their former “masters” in order to enrich the oligarchy ruling class these under-developped “nations” are sustaining.
How neoliberalism is applied in Lebanon?
Together with the governor of the Central Bank and the Prime Minister, the minister of Finance is a crucial player in the management of government debt.
From 1992, late Rafik Hariri PM, and later the Hariri clan hoarded the control of these three institutions.
The policy adopted in 1993 pegged the Lebanese currency to the US dollar. What that means?
The State borrows on behalf of the government large sums of loans that are not needed to finance the deficit.
The borrowing mechanism is basically a political decision to get the State tightly linked to outside multinational financial institutions… Institutions that the ruling class has invested in and wants to generate quick profit in this globalization era… at the expense of the people they claim to work for their benefit…
This scheme drove up the demand for the Lebanese currency, raised the interest rates on government debt, and high interest returns for depositors (reaching 30% at determined periods as the Future Movement spread the words among its elite class to deposit) and the new expatriate Contractor wealthy class of billionnaires…
Leading the country into a dept trap.
A debt ever increasing ($60 bn) and absorbing a third of the government budget, every year since 1992.
Servicing the interest of the debt has one purpose: Keeping the new neoliberal Contractors class in control of the management of the financial and economic institutions.
The main benefiaciaries were commercial banks and their wealthy depositors: Lebanon financial and economic elite classes (new expatriate contractors, warlords, oligarchic politicians…) have the necessary savings to invest in government debt instruments.
The notion of neoliberalism is that, as long as the government maintains the confidence of the elite classes in the soundness of the financial policy, the situation can remain in control, precariously in control, and relying mainly on foreign support for the policy.
The IMF working paper from 2008 mentions that the continuous rollover of Lebanon debt depends on an “implicit guarantor” from donors and international financial institutions.
And who is the main donor guarantor? It is Saudi Arabia absolute wahhabi monarchy.
This Saudi Kingdom
1. Bought up Lebanon government bonds when investors refused to buy the bonds
2. It provided the largest chunk of concessionary loans at Paris 2 donor conference in 2002, and Paris 3 in 2007
3. It transfered One $bn to the central bank during Israel preemptive war in June 2006.
Consequently, the governor of the central bank, PM and finance minister must satisfy Saudi Arabia confidence!
The Hariri clan main objective was to deepen neoliberal economic “reforms”.
Former Fouad Seniora PM reiterated the neoliberal program, including privatization of State-controlled entities, welfare “reforms“, politically aimed at curtailing patronage opportunities of political rivals to the Future Movement…
However, Seniora could not pull off his wishes of abolishing the Council of the South (a Box of money controlled by Parliament chairman and worlord Nabih Berri) or the Central Fund for the Displaced “sandouk al mouhajjareen” (controlled by the Druze warlord Walid Jumblatt)
For over two decades, the Hariri clan attached a dozen public institutions to the Prime Minister, controlled the municipality of Beirut, extendit building permits to its elites and the foreign investors and dropping any resistrictions when convenient, assigning public contracts to the “Future Elite contractors” and entrepreneurs at manyfold the proper cost, extending their hold on Solidere for 75 years, never accounting for the bids on Sukleen which collect waste in Beirut at $100 per ton while costing $30 in Zahle for example…
The current “national debt” has skyrocketed to reach $70 bn, even after 2 decades of paying high interest rates. In addition to funding the warlord “reconstruction chests”, part of the loans were used to paying the tribute to the Syrian oligarchy, since lebanon was under Syria mandated power till 2005.
Mind you that Syria, after 2001, began a neoliberal policy for its oligarchic elite class, and privatizing new public institutions such as the mobile telecommunication and oil extraction and grandiose Real Estates development in Aleppo, Homs and Damascus…
Note 1: The oil boom increased the number of Lebanese workers in the Arab Gulf Emirates and Saudi Arabia within a decade from just 50,000 in 1970 to well over 210,000 in 1980, or one third of Lebanon work force.
Note 2: Post inspired from two chapters written by Fabrice Balanche and Hannes Baumann in the book “Lebanon after the Cedar Revolution”
Note 3: A wealthy international neoliberal club requires from its members to extract profit from their own country, as a proof of allegiance to global neoliberalism, in order to facilitate the infusion of unwarrented loans to their corresponding State.
Have you witnessed that almost all current prime ministers, finance ministers and governors of central banks in Europe, the USA and many other countries were “employees” at the IMF, the World Bank , World Commerce institutions and international financial corporations?
Note 4: Basically, the expatriate billionnaire contractors initially got the blessing of the former civil war warlords (Nabih Berri, Walid Jumblatt, Samir Jagea… supported by Syria, Saudi Arabia and the US neoliberal financial institutions) who were brought back to power, and then managed their financial porfolio and financed the election campaigns as political allies…
Adonis Diaries 