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CEDRE Conference for Years, Lebanon Has Been Plagued With CEDRE Conference Geopolitical Context and its Implication on the Domestic Front Opportunities and Realization Potentials Maison du Futur, Sérail Bikfaya Friday, 21 September, 2018 For years, Lebanon has been plagued with vulnerabilities and mounting challenges, bearing the full force of regional tensions, particularly the neighboring Syrian war; these conflicts have negatively affected its economy, development, infrastructure and social fabric, along with structural problems that have hampered the long-term path of economic recovery and development. France hosted the "International Conference to Support Lebanon through Development and Reform" (CEDRE) on 6 April 2018, under the auspices of French President Emmanuel Macron and Lebanese Prime Minister Saad Hariri, and the participation of 50 countries, foundations and representatives of the private sector and civil society. During this conference, viewed as an expression of the international community's commitment to the stability, security and sovereignty of Lebanon, the Lebanese government presented its Capital Investment Plan (CIP) based on four pillars: Raising the level of investment in the public and private sectors, ensuring economic and financial stability through fiscal adjustment, commitments to reforms in various sectors, including countering corruption, modernizing the public sector and the fiscal management sector, and develop a strategy for multi-sectoral production and export potential. In line with the efforts Maison du Futur (MdF) has been deploying to keep pace with what would advance the political, economic and social conditions in Lebanon, MdF in cooperation with the Konrad Adenauer Stiftung and Levant Institute for Strategic and Economic Affairs, held at its headquarters in Saraya Bikfaya on Friday, 21 September 2018, a round table to discuss two policy papers, the first entitled “The Paris Conference IV: Opportunities and Implementation Potentials”, prepared by Dr. Kamal Hamdan, economic expert and Executive Director of Consultation and Research Institute, and the second entitled “The Geopolitical Context of the Cedar Conference and its Impact on the Domestic Front”, prepared by Dr. Sami Nader, expert in Middle Eastern affairs and Director of Levant Institute for Strategic Affairs. Former Prime Minister Fuad Siniora, former ministers Roger Dib, Damianos Kattar and Nicolas Nahas, advisers to Prime Minister, Nadim Al-Munla and Hazar Caracalla, as well as a group of bankers, economists and financial experts attended the seminar. In his inaugural speech, President Amine Gemayel said that "friendly countries are trying their best to help us, yet these efforts will remain fruitless if we do not help ourselves. The responsibility lies first on our shoulders”. "How can we look into achieving a development economic program while fundamental institutions are disabled? Where are the Financial Inspection Division, the Judicial Inspection Division, the Administrative Inspection Division, the Court of Audit and the Civil Service Council?" he asked. He considered that all previous development initiatives have faltered because the basic rules of good governance were ignored, whereas, “implementing a development rescue plan and improved governance go hand by hand”. He added that the first indispensable step to ensure the advancement of the country is to return to the constituent texts of the Lebanese State and its institutions, especially those agreed upon since the end of the 1950s and which had placed the Lebanese administration in the ranks of civilized countries. The second step is to revive the Lebanese democratic system, and the third step is the establishment of a national authority tasked with overseeing the implementation of CEDRE’s outcomes, in order to ensure a comprehensive, balanced and national development. Finally, he asked: "As long as Presidents Michel Aoun and Saad Hariri enjoy a popular, political and parliamentary cover, why not opting for a small-scale rescue government whose members would be competent, credible, experienced, integral and transparent”. He added that such an initiative will uphold the state’s institutions, build the necessary conditions for the success of the development plan, and revive the constitutional assets of the country along with the proper democratic practice”. In his speech, the Director of the Konrad Adenauer Stiftung in Beirut, Dr. Malti Gayer, welcomed the participants in this workshop held at the headquarters of “one of our oldest partner, MdF”. He said that after nine years of postponement, the legislative elections were conducting against the backdrop of prodigious challenges facing the country, the most important of which is the need to take quick measures to develop the economy and address the negative repercussions of the neighboring war and the Syrian exodus. He added that the economic indicators show an increase in poverty, which amounted to 66%, and with the waves of refugees, Lebanese find it difficult to access basic services, in addition to the social dissimilarities that can only be addressed through a comprehensive economic plan that requires Lebanon to carry out fundamental structural reforms. He said that Germany had always sided with Lebanon, and the two countries are bind with political and economic partnership boosted with the recent visit by German Chancellor Angela Merkel. He concluded by stressing that security remains the main pillar of development and the only mean to absorb local, regional and international crisis. The coordinator of the round table, Nasser Yassin, from the Issam Fares Institute for Public Policy and International Affairs at the American University of Beirut, took the floor and said the discussion of these two policy papers will raise many questions, "but the most important one in my opinion is how will Lebanon deal with its crises while Arab nations have gave up on their ties with Beirut? How will the internal changes in the Gulf countries affect the expat Lebanese workers and thus our economy?” On the other hand, he asked: "How can we address the continuous fattening of the Lebanese administration because of patronage, a problem which exhausts the resources of the state?” How to reduce the phenomenon of social inequality neglected by the CEDRE Conference, knowing that only 5% of the population share wealth? How can we address the cabinet formation deadlock while major political blocs are wrangling over ministerial posts? There is a negative mood among the Lebanese. How can this mood be changed and improved? The good mood that had existed during the reign of Prime Minister Rafik Hariri is no longer and Lebanese, especially the youth among them, are looking abroad eager to immigrate”. Sami Nader took the floor stressing that he will tackle the geopolitical context of the CEDRE conference and its impact on the domestic front. He said that the first major geopolitical shift that has impacted Lebanon was the significant overhaul the US Middle East policy has undergone since Trump took office: The American appeasement policy towards Iran has been replaced by a much harder stance. The deterioration of US-Iranian relations casted a shadow over Lebanon, especially in terms of reducing opportunities for political settlements as it was the case during the formation of the government of PM Tamam Salam. He recalled that Salam’s cabinet assumed office in light of international rapprochement with Iran. In fact it was Foreign Minister Mohammad Javad Zarif who, on the sidelines of the 2014 World Economic Forum in Davos, announced that the Lebanese cabinet would soon come into being. The second geopolitical shift is the growing Russian role in the region and the developments witnessed in neighboring Syria. He said: “Needless to say that Russia has emerged victorious in Syria and managed to build on its military intervention by brokering understandings with Turkey, Iran, Saudi Arabia, Egypt and the United States; Russia has won in Syria and is currently at the driver seat”. He added that at a time when the roles and sizes of all the players in Syria have been decided, the size and role of Iran in Syria in particular and in the Arab Levant in general, remain uncertain. Furthermore, “some parties are betting on Iran’s defeat in Syria. Such scenario is unlikely to happen; the Iranian influence in Syria could wane but it will not fade, for all parties, especially Israel, have interest in keeping the balance of power in Syria and retaining the Palestinian Cause at the backseat”. The third factor is the probability of Israel waging a war against Lebanon; in such case, risks for companies willing to invest in Lebanon within the framework of the CEDRE Conference will skyrocket. Hezbollah Secretary-General’s confirmation of having precision rockets is worrisome, as is Israeli PM Benjamin Netanyahu’s talk about preemptive war when he was speaking at an event marking the 1973 October war. While the occurrence of an Israeli war against Lebanon remains speculative, one cannot underestimate its devastating impact on investors should it hit; memories of the unrestrained bombing of all Lebanese infrastructures during the 2006 war are still fresh in mind. The forth factor is the profound structural shift in Saudi policies at all levels, particularly foreign policy. The Kingdom abandoned its strategic policy of appeasement and patience and charted a new more aggressive and robust one, mostly embodied by its led-Arab military intervention in Yemen. The Gulf Countries Council’s (GCC) accusation to Hezbollah of
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