Front Burner - A country in crisis: Lebanon one year after the Beirut blast

Episode Date: August 5, 2021

A year after Beirut’s deadly port explosion, Lebanon’s economy is in freefall and protesters have hit the streets. Journalist Rebecca Collard gives us the backstory.

In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections. This is a CBC Podcast. Hello, I'm Antonin Estlan, in for Jamie Poisson. It's been one year since Beirut's deadly explosion. At least 214 people died and thousands of others were left injured. All because of the mismanagement of 2,700 tons of ammonium nitrate that was

stored in the city's port. Well, on the anniversary of the tragedy yesterday, thousands of people in Beirut once again hit the streets, some threw stones and smashed a police car, while officers fired water cannons and threw tear gas canisters. The protesters want Lebanon's leaders to be held accountable for the blast, but they're also pointing to other problems in the country. Lebanon is in an economic spiral, and after the explosion, it's gotten worse. How did things get so bad for Lebanon? That's what Rebecca Collard is discussing with me today. She's a freelance

journalist and frequent contributor for CBC based in Beirut. Hi, Rebecca, and thank you for being on the podcast. Hello. So I first want to start with, we last spoke after this massive explosion in Beirut that killed at least 215 people. Still plumes of smoke rising above this site. And also people on scooters taking the injured to hospital, people in civilian cars, everything, everything in the neighborhood closer to the port is basically flattened. You saw, you know, buildings that just basically didn't exist anymore. But let's talk a bit about what happened next. How do people in Lebanon feel like

things were handled afterward? You know, I'd say most people feel like things just simply weren't handled. And I would say that applies to, you know, the rebuilding and reconstruction after the blast. That applies to the investigation into the blast. And that applies to dealing with this dramatic economic crisis that the country is facing. Inflation has driven the country's currency to historical lows. Shortages are pushing up the costs of many essentials. The price of subsidized bread has been hiked five times this year alone. There has been, you know, really little action from the government anyway on any of these fronts. And I think that that has really created a lot of anger in the country.

You know, we're a year after the blast. We still do not have a proper investigation into what happened. The country is sinking deeper and deeper into an economic crisis, and the leaders of this country can't even form a government. So, you know, things really here just haven't been handled at all. Just from an accountability standpoint, it's one thing to not do much after the fact, but also to acknowledge that you did something wrong. It's been a year. Can you tell me a bit about how much the government has taken accountability for what happened? I'd say it's close to zero. You know, most people in this country know they hold the government responsible for what happened.

You know, there's so many unanswered questions still about how the ammonium nitrate got to the port, why it was offloaded, why nothing was done about it. Even there's questions about how the fire started that ended up causing the explosion. But I would say one thing that we do know, and it is very clear, is a lot of Lebanon's leaders knew that those chemicals, that there were 2,700 tons of highly explosive ammonium nitrate in a civilian port just next to a residential area, and nothing was done about it. And there are calls now, and there have been calls really since the beginning, for an international investigation into what happened. Some rights groups want the UN Human Rights Council to initiate an investigation, which is really interesting because that sort

of investigation by the UN Human Rights Council would usually be reserved for things like war crimes, potential war crimes in Syria, atrocities in Myanmar. But they're saying that, you know, they want the UN Human Rights Council to initiate an investigation on the principle that of the right to life that their right to life was violated. But I also say, you know, I was yesterday I was speaking with one, one woman who lost her husband in the blast. It was a really tragic story. She detailed to me all the kinds of coincidences and the way the whole day unfolded that they were all in the house at 6 p.m. last August 4th.

And, you know, in a minute, she lost almost everything. She lost her husband. She lost her home. She lost her place of work, which was also in the building. I paid too much. I paid too much. I paid too much. I paid blood. We paid blood in my family.

And I was asking her, you know, like, do you think you're going to have justice? And she just almost laughed at me. Like, here in Lebanon, there is no justice. I don't believe in justice. All the government are guilty. So someone who is guilty can't find the truth you know because he is the guilty and again she said something to me you know really interesting she told me this story about

how that day she was she was watching the fire in the port and her husband came out and her husband said don't be afraid my kids and we thought that we are living near a storage of rice and wheat, not near nitrate, Hiroshima. And this idea that, you know, they had no idea what was in the port. But the Lebanese leaders knew what was in the port. And, you know, they were sitting there, everybody was watching it burn. And the people in this neighborhood where I live and the people in the neighborhood where she lives had no idea what was in the port, the danger that they were looking at. But the Lebanese leaders did know.

And I think that that is something that the people really want to see their leaders held accountable for. I want to go back to the economic crisis that you just brought up, shortage of basic supplies. I think for people who don't understand, can you paint a picture of what that looks like as far as daily life in Lebanon? Yeah, it is just getting worse and worse all the time. There is maybe two or three hours of government power a day. The rest of the time we're on generator, and then those generators can't keep up with the demand.

So, you know, we're in the dark from most places in Beirut from 2 a.m. until 6 a.m., and that means no fans, no air conditionings. It's over 30 degrees. It's very hot. There are lineups for fuel. People are fighting over food in the grocery store, over goods that are subsidized. Pharmacies are out of medication.

You know, I just came back from Iraq, and people asked me to bring things like antidepressants, basic painkillers, baby formula, because they see Iraq now as a country that is better supplied than them. And to think about what that means and how symbolic that is for the state of this country, you know, it's really becoming a devastating situation. And I think the scariest part about it is that there doesn't seem to be a way out of this crisis. It's still hard to see that there's, you know, like there's anywhere to go but down from here. This country is $90 billion in debt. It has one of the highest debt to GDP ratios in the whole world. At the same time, it has almost no industry. Its biggest export for decades has been people. It has educated people. It has successful people. Its export is people. They produce almost nothing.

And because of the financial engineering that we've seen in this country for the last few decades, it kind of meant that producing things domestically just wasn't competitive. Imports were super cheap because there was an artificial peg of the Lebanese lira to the dollar. So everything was cheap to import. People just import a thing. There was no real incentive to foster business and industry in this country. So now they're facing this massive economic crisis. Something like 80 percent of the goods in this country are imported and they have no way out of it. The World Bank is warning this financial collapse could be one of the worst in modern history. The Lebanese pound has lost 90 percent of its value and it's still falling.

All the people are hungry. No one has anything to eat. There's no electricity in our homes. Children need milk. No one can afford to buy it. That's why we're here. You know, Rebecca, like last year when the blast happened, I went to, I covered several protests in Montreal from the Lebanese community. They were in front of the Lebanese consulate. They're all corrupted. When you hear them chanting, it means every last one of them.

We need to reestablish political parties that are not sectarian parties, that don't go based on religion, that don't go based on what their fathers used to like. And one thing that stuck out to me, and I'd like to get your take on it, a lot of people were telling me, I love Lebanon. I want to go back. It's my country. But I just can't because things are so chaotic there. That was in Montreal.

What are you hearing from people in Lebanon who haven't left when it comes to their prospects of staying in that country? You know, I'll tell you an interesting story. Lebanon who haven't left when it comes to their prospects of staying in that country? You know, I'll tell you, I'll tell you an interesting story. A while after the blast, Hariri came back as, Saad Hariri came back as prime minister-designate. And if you remember that the protests that started in October of 2019, the first real success was that Saad Hariri stepped down, the prime minister stepped down. For 13 days, the Lebanese people have waited for a decision for a political solution But Sadriri stepped down. The prime minister stepped down. For 13 days, the Lebanese people have waited for a decision for a political solution that would stop the deterioration.

I've tried during this period to find a way out, to listen to the people's voice and to protect the country from economic security and social dangers. Today, I will not hide it from you. I have reached a dead end. When these protests first started in October of 2019, there was a lot of hope here. People really thought that things were going to change. Now I went back to the street to find people that were protesting the fact that Saad Hariri was back in power. And I ran into these three guys not far from my home. And I said, what are you doing? Are you going to protest? And they said, no, we're going to Canada. And I was like, what? And one of them had written his exams that morning, his English exams for immigration to Canada. The other two were also in the process of applying. And I think what you're saying is very interesting. People really do love this country.

People feel connected to this country. But I would say, especially the young people here, they want out. Everywhere you go now, people are talking about immigrating. And there's, you know, two different ways people are doing that. There's one that for a while last year, they were going very dangerously by boats trying to make it to Cyprus. But then you have this like young, educated middle class who are trying to immigrate to countries like Canada because they just don't see any hope here anymore. And I think the blast really fueled that for a lot of people. Already, the situation was bad, but after the blast, there was just this massive push for people to want to leave this country.

Pamela Fransawi can't take it anymore and is ready to leave for Canada. And everyone she knows wants to get out too. You just feel like you're working and you're putting in all that effort and it's all for really nothing. In the Dragon's Den, a simple pitch can lead to a life-changing connection. Watch new episodes of Dragon's Den free on CBC Gem. Brought to you in part by National Angel Capital Organization, empowering Canada's entrepreneurs through angel investment and industry connections. Hi, it's Ramit Sethi here. You may have seen my money show on Netflix.

I've been talking about money for 20 years. I've talked to millions of people and I have some startling numbers to share with you. Did you know that of the people I speak to, 50% of them do not know their own household income? That's not a typo. 50%. That's because money is confusing. In my new book and podcast, Money for Couples,

I help you and your partner create a financial vision together. To listen to this podcast, just search for Money for Couples. I help you and your partner create a financial vision together. To listen to this podcast, just search for Money for Couples. We know the government has not been stable for a very long time in Lebanon, and it's actually added to the crisis. Can you tell me how did the country get to this point? Yeah, well, first of all, I'll say there really is no government, right? We've been basically without a government since after the blast. Prime Minister Hassan Diab has just gone to see President Michel Aoun to tender the resignation of this government because of what happened at the port. So for the last however many months, eight months, 10 months now,

Saddam Hussein was trying to form a new government. That didn't happen. There's no new cabinet. He has been prime minister numerous times. He most recently stepped down just a few weeks ago after failing to form a new government. And I think that's part of the depressing thing that they can't even form a government. And this government is really badly needed

because essentially there are international institutions and foreign countries that want to give aid to Lebanon to help it recover from this financial crisis and from the blast. But they want certain reforms and there are certain conditions on these loans and this aid. can't even, the leaders of this country, I should say, can't even form a government to make those reforms and to meet those conditions to even unlock this money and unlock aid and loans that's badly needed here. So if you think about that, it is just such like, how would you as a young person in this country have any hope now? It's interesting you say there is no government. From the outside looking in, things look to be changing quickly as far as the political dynamic. You have Najib Mikati, who is now the country's prime minister-designate. Endorsed by most of Lebanon's political parties, he is, for them, a consensus candidate.

Unlike many Lebanese leaders, Najib Mikati doesn't belong to a political bloc or dynasty. But he does happen to be the country's richest man. Can you tell me a bit about how people feel about this decision, him moving into that spot? I mean, I think for a lot of people, it seems irrelevant. What we've seen since Saad Hariri first stepped down in October, just after the protest started in October of 2019, is kind of just a recycling, for the most part, of political elites.

So, Najib Mugughalati has been Prime Minister before. I don't think he's the sort of change that people are looking for. Whether or not he's going to be, in some ways, he might be in a better position to form a cabinet. But what people have been demanding since October of 2019 is they want fresh faces. They want a government filled with experts that really have the best interests of this country at heart, because, you know, nobody here, or very few people here, I should say, still feel that way about their leaders. You know, many of the leaders that are in power now were either the warlords during Lebanon's civil war, or they're the children of warlords that were responsible for all kinds of

atrocities during Lebanon's civil war. And when Lebanon came out of that war, and they signed the Ta'af Accords, they essentially re-entrenched the sectarian political system. And the idea is that, you know, on the surface, it sounds kind of good. You know, each of the sectarian political parties are going to get a seat at the governing table, and because everybody has a say in the government, that means that we're going to keep the peace here, right? But what that meant instead is that you have a bunch of elites, most of them former warlords, who are more interested in themselves than they are in the people. And instead of having any sort of accountability, what you have here is mutual impunity. You have these former warlords looking the other way as they embezzle, as there's mismanagement, as there's corruption, and essentially dividing up the assets of the state rather than using them to the benefit of the Lebanese people.

And to just give you a little example of that, you know, Lebanon has been, there's been informal capital controls here for, I guess, almost two years now where Lebanese were not able to take out their money from their accounts. And that obviously is very frustrating. Imagine you have money in your bank account and you're not allowed to take it out. So it was, you know, $200 a week, then it was $200 a month. Now during this period, $6 billion or something, they estimate, left the country. So there is like, you know, there's two sets of rules and two sets of laws in this country. So while Lebanese people are not able to get their basic amounts of money out of their bank accounts, the elites are sending billions abroad. And I would say a lot of this impunity and this lack of accountability really comes from this political system that was installed after Lebanon's civil war. you that it's the same sort of corruption, mismanagement, and negligence that caused the

economic crisis in this country that also led to the blast here last August that destroyed so much of the capital city and left hundreds of people dead. So what does the international community want to see from Lebanon in order to step in and help? Well, I think there's a host of economic reforms that they want to see from the country to make sure that any aid that's going to be given to the country will, you know, produce something sort of sustainable outcomes going forward. But I also think there are questions about accountability. You know, as I said, at this point, I think it's so clear that so much money was mismanaged and embezzled and lost to corruption that they want to make sure that there's going to be checks and balances. And I'll just say one other thing. You know, I was speaking to one woman yesterday and she just said to me, you know, Lebanon needs help. We need help from the international community. But she said straight up, do not give it to our government.

Only the people, only. Not the government. Not at all. Because people here know that and they're worried that like if more aid comes to the government, not at all. Because people here know that, and they're worried that like if more aid comes to the government and more loans come to the government, these same people are going to embezzle and they're going to mismanage. And it's not going to be better. A lot of people in this country don't want to see aid going to the government. Moving forward, Lebanon has been through a lot. At this point, what do you think could happen next? Where do you see this going? I think what we're talking about now, there is no way to avoid this financial crisis.

There, sadly, I think is only one way to go for Lebanon. And that is down. And I think that's really sad. I think there's two things at stake now. The first one is how quickly that happens. So, you know, mitigating this crisis. So if there is a government and they do manage to make reforms and they do get loans, we're going to mitigate this crisis. It's going to be not as fast. It's going to be not as painful. And the second and really important thing I would say is that it's about who is going to pay for this crisis. So, so far, what we've seen is the poorest Lebanese paying the highest price for this crisis. You know, 50% of Lebanese are believed to be below the poverty line now. People are struggling to get food. And, you know, the way that this crisis has played out with the informal capital controls, for example, that I talked to you, that I was telling you about that, you know,

regular Lebanese couldn't take $200 out of their bank accounts, but somehow $6 billion was disappearing from the bank accounts of the elites and going abroad. So what we've seen is the poorest Lebanese paying the highest price. And so that's the next thing that to see, you know, reforms and policies that make sure that the poorest Lebanese do not bear the brunt of this crisis that was essentially created by the elites in this country. Yeah, to hear about apathy sinking in after what happened last year is certainly a troubling sign, it seems, for the country. Rebecca, I'd really like to thank you for taking the time to be with us on the podcast,

and thank you very much. It was great to speak with you. One more thing on this story before we go today. Yesterday afternoon, a group of countries announced they had raised $370 million in aid for Lebanon. According to the president of France, this will go to help with humanitarian needs in the country. Emmanuel Macron's office said this emergency aid is unconditional, but about $11 billion that had been raised for Lebanon in 2018 remains locked away, and that money is still conditional on major reforms. That's all for today. Thanks for listening to FrontBurner.

I'm Antonin Aresta, and we'll talk to you tomorrow.