Friday, August 29, 2008

On the Media Battle for Lebanon, May 2008

Arab Media & Society

On May 7, what was supposed to be a day of strikes to demand higher wages metamorphosed into eight days of fighting between the Hizbullah-led opposition, “March 8”, and the pro-government, “March 14” forces. (1) At the forefront of Lebanon’s bloodiest infighting since the civil war were the media, relaying the heated words of politicians that stoked the conflict while beaming out propaganda thick and fast. Lebanon’s media divisions became further entrenched in their sectarian and political camps, pan-Arab media did the same, and media outlets came under direct attack. (2) The Lebanese public, meanwhile, holed themselves up inside and watched events play out on TV.

After Ghassan Ghosn, the head of the General Confederation of Lebanese Workers, announced that the strike was cancelled, Hizbullah and its supporters shut down Beirut by blocking roads with piles of rubble, burning tyres and overturned rubbish bins. The following day, Hizbullah military units moved into the west of the city and started taking over, engaging in street battles with members of Sunni politician Saad Hariri’s Future movement and affiliated parties.
What changed a day of socio-economic concerns into political violence were demands Prime Minister Fouad Siniora’s government made in the days prior to the clashes. Walid Jumblatt, the pro-government Druze leader and head of the Progressive Socialist Party (PSP), had called for Hizbullah’s private phone network to be shut down, the removal of surveillance cameras Hizbullah had installed by runways at the airport, and for the head of airport security (a Shia by the name of Wafik Shoukair), to be replaced as he was alleged to be working for Hizbullah.
On May 8, Hizbullah’s Secretary General Hassan Nasrallah responded in a press conference, saying the decisions of the government were “tantamount to a declaration of war and the start of a war...on behalf of the United States and Israel.” He also went on to say that the phone network was used in “defending the country against Israel,” and that Jumblatt’s dream “is Sunni-Shia strife. We will not fulfil his dream.” (3)
That evening, as reported by only a few media outlets and relayed in a firsthand account from an employee of the Hariri-owned, pro-government Future TV (FTV) channel, the Future movement brought in thousands of men from Akkar and Tripoli to the Kantari area of West Beirut. “There were two six-wheeler trucks full of mattresses for the guys to sleep on in preparation for a fight. When we saw them we felt more comfortable, then the next day they all disappeared. Maybe they ran away or the Future movement changed its mind and didn’t want a clash. The men were paid to be there, and not armed, just with batons,” he said.
The next group to disappear from around the FTV offices in Kantari were the Lebanese Army, including three armoured personnel carriers that had been stationed in the channel’s parking lot. Then the SecurePlus security guards hired to protect FTV fled, bar one blubbering 18-year old security guard that had to be slapped around by the news editor to “act like a man.” (4)
On the morning of May 9, the FTV employee said an army officer entered the Kantari offices. “He said armed men were outside and if you don’t leave the building, they will come in or burn the building down. The news editor asked for re-assurances: for employees to be allowed to leave and the station to not be harmed, as well as for one technician to stay behind. After everyone left - according to the technician - the Colonel came back with Hizbullah technicians to be taken to the master control room. Cables, uplinks and satellite links were cut – they were professional and knew what they were doing. They needed to find the server, so made the technician call the head technician to find out, and on the phone [Hizbullah] said they knew where he lived.”
Future TV’s terrestrial, satellite and news channel, Future 24, were off the air. New TV, a pro-opposition TV channel, was later given exclusive access to film the seized offices. Meanwhile, Future’s radio station Al Sharq, the Future-owned Armenian radio station Sevan, and the Mustaqbal (Future) newspaper had their offices raided and ceased operations.
Later that Friday afternoon, Syrian Socialist Nationalist Party (SSNP) members, in an act of revenge for the burning of SSNP offices by Mustaqbal supporters during clashes in February 2007, set the FTV offices in Raouche on fire. The FTV employee said an estimated 20-30% of the channel’s archives were lost during the fire, including footage of Harb Tamouz (the July 2006 war between Hizbullah and Israel). “Fortunately, the week before a big part of the archives had been copied, and all the footage relating to Hariri was in a different location,” he said.
New TV's footage of the seized Future TV offices

Propaganda a go-go

Prior to the shutdown of FTV, violence had escalated on the streets of West Beirut and in other parts of the country. Lebanese TV channels were constantly streaming live news of the events, with reports, statements, claims and counter claims forcing viewers to keep an eye on all channels to get an idea of what was going on. (5)
Even pan-Arab channels were showing their true colours, with Saudi-owned Al Arabiya TV clearly on the side of the Siniora government and against Hizbullah, while the Qatar-owned Al Jazeera gave sympathetic coverage to Hizbullah.
Members of the government came out and decried Hizbullah’s actions as a “coup d’etat,” which was quickly picked up on by March 14 affiliated media outlets, on Al Arabiya TV, as well as by the Western media. March 14 also denied that Future had a militia, reiterating that the only militia in Lebanon was Hizbullah, and that, in the words of Hani Hammoud, senior adviser to Hariri, “the end result is that Iran has taken over the country.” (6)
Al Manar and NBN, on the other hand, spoke of the “government’s militia”, and that March 14 was receiving orders from Washington and Israel, making Lebanon a pawn in the US-Zionist agenda for the Middle East, thus a legitimate target.
Hizbullah played the take over of Beirut as a move in a “correction-ist direction, bringing a new identity to Beirut, of being against Israel,” said Dr Ibrahim Mousawi, a Lebanese political analyst allied with the March 8 movement.
The night of May 9 was an exception to all the news that had filled up the airtime of Lebanon’s television channels. The Christian channel LBC, lacking any competition from FTV, which had the rights to air Superstar (the US’ Pop Idol), broadcast live reality show Star Academy at peak time. (7) The show featured a choreographed sequence of women in leather dancing amid chains at the start, and a full audience in attendance. (8) Al Manar broadcast a Syrian soap opera.

LBC's Star Academy aired live while the clashes continued in Beirut...

...Al Manar aired a Syrian soap opera

The next day, May 10, propaganda went into overdrive, with Al Manar showing video montages of March 14’s connections with the United States via slowed-down, key-hole style images of Jumblatt meeting with US Assistant Secretary of State David Welch, and Siniora meeting with US Secretary of State Condoleeza Rice (but notably avoided showing footage of Rice and Welch meeting with Parliamentary Speaker and Amal leader (March 8), Nabih Berri). (9) Al Manar also showed footage of a hand grenade with Hebrew writing on it that was allegedly found in pro-government offices, implying March 14 was receiving military aid from the Israelis.

Al Manar footage of an Israeli hand grenade allegedly found at a Future Movement office

But with Future TV off the air, March 14 was left with only one sympathetic Lebanese TV station, LBC, which aired footage of a demonstration outside the FTV offices to protest the channel being taken off air.
"The shutting down of FTV showed the increasing importance of the media as a target on the battlefield,” said Habib Battah, an independent media analyst on the Middle East. “Keeping FTV off the airwaves was a psychological attack on Future's political supporters. It also gave the other side a monopoly over propaganda messages, with no channel to rebut the damaging allegations that were made against it.”
Among the opposition there was a great deal of schadenfreude over FTV being silenced. The fact that Al Manar and Hizbullah had made so much noise over the destruction of Al Manar’s studios in Beirut’s southern suburbs by Israeli fighter jets in Harb Tamouz (the July, 2006 war) aggravated many people when it came to the shutting down of FTV, with condemnations coming in from around the world. And unlike Future TV, which re-started broadcasting on May 14, Al Manar had contingency plans for an attack on its facilities and was only off air for two minutes. (10)
“It is ironic that Al Manar protested Israel's attack on its headquarters as a violation of the free press while Al Manar supporters helped shut down a Lebanese-owned media outlet less than two years later," said Battah.
The decision to not merely gag by totally silence FTV even angered some March 8 supporters, with Mousawi saying he didn’t agree with FTV being shut down and that it “backfired” on Hizbullah.
According to Ramez Maalouf, Professor of Journalism at the Lebanese American University, Hizbullah’s rationale behind taking FTV out of the media equation was to calm down the situation in the country.
“People in Hizbullah said [if FTV stayed on air] it would make the war more violent and dangerous, and was a way of keeping things quiet,” he said. “To me it was dangerous, as it further underlines the idea that people have that Hizbullah can do anything as it is on a mission from God.” (11)
Later on May 9, however, Hizbullah issued an apology for the closure of FTV and the treatment of journalists while covering events, but laid the blame squarely on the government’s shoulders. (12)
"We are sorry about everything that has happened to the press corps, but the government is to blame for letting things get this far. We hold the government fully responsible for everything that has happened to the media. We hope these media will be operating again soon under the control of the Lebanese Army,” Hizbullah MP Hassan Fadlallah said in a statement issued to the Lebanese National News Agency. (13)
Somewhat ironically, on the final day of the conflict, on May 14, when fighting had shifted from Beirut to the Chouf and Tripoli, Al Manar released a statement citing “violations of press freedom” when viewers in northern Lebanon complained that Future movement supporters had pressured local cable providers to stop broadcasting Al Manar, NBN and OTV.

Media war

“Truth was the victim of this war, and there was a lot of misleading propaganda,” said Mousawi. “Of course there were variations between one outlet and another, and I believe the media that followed the March 14 camp made the largest distortion – FTV became just like any media outlet of a gang, and didn’t hold to basic principles of journalism, inciting hatred and creating news about things that didn’t exist. At the same time, the March 8 media was not impeccable either - all made mistakes.”
Mousawi added that March 8 media was keen not to fall into the trap of provoking fitna – discord – between the Sunni and Shia, which Nasrallah claimed Jumblatt and the government were trying to do, and what Hizbullah claims is an American project in the region (this Shia-Sunni divide is referred to in some Washington DC circles as the “Sushi war”).
To Maalouf, blame lay less with the media than with Lebanon’s sectarian political system.
“It’s a case of politicians bringing things to a boil, but the media needed to use words more carefully,” he said. “I think the fault lies with the politicians as it’s about the choices the political system gives people, not the media.”
Maalouf said LBC was seen as the least biased of all the channels.
“But all in all, LBC is like An Nahar (newspaper), centre-right,” he added. Notably, he said OTV, allied to opposition leader Michel Aoun’s Free Patriotic Movement, increased its viewership during the clashes.
“The more divided the audience became, the more people navigated to the channels that reflected their views. For instance, the tenser it became, the more Christians watched OTV, which they didn’t watch much usually,” Maalouf said.
To Battah, the conflict showed that most Lebanese television stations have become an intrinsic part of the infrastructure of the political establishment.
“Lebanese TV is no longer just biased, it is one of the most important weapons in the hands of political groups,” he said.
“This has led some Lebanese politicians to justify attacks on the media, and unfortunately this is now accepted by many of their constituents. It’s a very dangerous development because even now average citizens are engaging in attacks on journalists just because they don't agree with the broadcaster's politics. This is definitely a low point for Lebanese journalism. The polarization of society has increased sectarianism in the press and stoked hatred toward the press as a whole.”

The Aftermath

While viewing habits had changed during the clashes, the media environment started to get even more virulent once the fighting died down and FTV was back on air.
With the fighting ongoing, FTV had re-located to Beirut Hall to prepare for getting back on air. “We waited for the political green light as Future faced a lot of threats that the Kantari offices would be burned down [if FTV went on air],” said the Future TV employee.
When FTV re-launched, channels like Al Arabiya showed solidarity by re-broadcasting footage, while LBC aired a statement by the Mufti of Beirut on Marcel Ghanem’s show saying FTV was back.
“It’s a different story how coverage changed after re-broadcasting,” said the FTV employee. “FTV went from being biased to being extremely biased. It started calling it an Alam Harb (“media war”), people were asked not to say certain things and to cut a statement to change the meaning. For instance, they transcribe a speech and then the editor underlines the words you can use, five words here and 20 words there, and this changes it all, it becomes a different speech. The management and the news directors also started saying they [March 8 media] are lying in news bulletins and creating this story, so it’s ok for us to do whatever. I think this is the worst effect of what happened,” he added.
Al Manar meanwhile started portraying the end of the conflict as a victory for Hizbullah, which had not capitulated to any of Jumblatt’s demands and, by force, driven March 14 into an agreement in Qatar that ended a political crisis that had lasted 18 months. In December 2006, Hizbullah and co. pulled out of the government and established a tent city that closed off downtown Beirut. Once President Emile Lahoud stood down from office in November last year, the political standoff stalled the election of a new head of state some twenty times. By June 21, with a compromise reached on a new president, General Michel Sleiman, the tents were taken down and Beirut appeared to be back to normal.
On the TV, programming returned to its usual content, including politically partisan points of view and journalism that skirts the line between news and propaganda.


1) The March dates refer to demonstrations in downtown Beirut in the wake of former Prime Minister Rafik Hariri’s assassination on February 14, 2005. March 8 consisted of Hizbullah and Amal, while March 14 (the date of the so-called ‘Cedar Revolution’) consisted of Hariri’s Future movement, the Progressive Socialist Party, the Lebanese Forces, the Phalange Party and Aoun’s Free Patriotic Movement (FPM). The predominantly Christian FPM later joined March 8, diving the Christian community.
2) Lebanese TV channels are split into two camps: The pro-opposition channels are Hizbullah-backed Al Manar TV, the National Broadcasting Network (NBN), which is partially backed by Shiite parliamentary speaker and head of the Amal movement Nabih Berri, New TV, and the Free Patriotic Movement-run Orange TV or OTV. Pro-government channels are Mustaqbal (Future) TV, owned by the Hariri family, and the Lebanese Broadcasting Company (LBC). See Paul Cochrane, ‘Are Lebanon’s Media fanning the flames of sectarianism?’ in AMS -
3) A transcript of Nasrallah’s speech is available at
4) Members of the opposition, and opposition media, claim the Hariri-owned security company SecurePlus is the Future movement’s militia.
5) Both Al Manar and Future TV did not reply to official requests for interviews with the management.
6) Nick Blandford, ‘Uncertainty deepens in Lebanon as Hezbollah seizes control of west Beirut’, Christian Science Monitor, May 9, 2008 -
7) Saudi prince and billionaire Walid Bin Talal increased his stake in LBC-Sat and the Production and Acquisition Company to 85% in July this year.
8) Beirut Report –
9) For screen shots and descriptions of media coverage during May see Lebanese-American journalist Habib Battah’s blog, Beirut Report –
10) See Paul Cochrane, “Bombs and broadcasts: Al Manar's battle to stay on air” in AMS -
11) Maalouf was making a reference to the slogan Hizbullah adopted after Harb Tamouz – “Nasr min Allah,” Victory from God.
12) Many journalists, foreign and Lebanese alike, were threatened by Hizbullah and Amal gunmen when trying to cover events. Two Al Jazeera TV staff were also wounded during clashes in a Beirut neighbourhood. An Al-Arabiya TV crew were briefly taken prisoner in a Beirut suburb on May 8, released after half an hour by Hizbullah.


Tuesday, August 19, 2008

Syria’s Water Shortages: Agriculture, Subsidies and Hydropolitics

With flour subsidised, crop failure this year has eaten into the government's four to five millions tons of reserves

By Paul Cochrane in Damascus, Executive magazine

SYRIA IS IN THE MIDST of its third year of drought. Some 90% of the barley has been lost due to crop failure, the wheat harvest is down by over 50%, and ground water reserves are running low.
In the face of such a crisis, Syria has had to resort to the international wheat market for the first time in 15 years, no longer self-sufficient or able to export from what was, since antiquity, one of the region’s bread baskets.
This hydrological crisis couldn’t have come at a worst time for Syria, with the country attempting to implement widespread economic reforms and reduce subsidies while food, energy and living costs continue to spiral upwards. Furthermore, the international price of wheat has risen 83% over the past year, putting strain on Syria’s budget deficit and wheat reserves.
Such hard realities couldn’t be further from the rosy picture presented by the media and investors in the wake of Syria’s economic reforms, who cite surging investments, the financial sector’s exponential growth, a stock market in the offing, and rising tourism figures.
“People are bullish on Syria, but there are problems we are facing,” said Dr Nabil Sukkar, managing director of the Syrian Consulting Bureau for Development and Investment. “Agriculture is not fashionable, people instead talk of industry and ICT, but it should be given the priority it deserves in Syria,” he added.
The scale of Syria’s hydrological woes is forcing the government to rethink its agricultural policies as wheat and barley reserves dwindle. Last year, Syria produced 4.1 million tons of wheat, more than enough to meet demand for the 4 million tons consumed domestically. But the government estimates this year the harvest could be as low as 2 million tons, a drop of over 50%, if not lower. Barley, which accounts for 10% of Syria’s grain production, has declined 90%, having an immediate knock-on effect on the livestock sector, which used 60% of all barley as animal feed. Many small-scale farms have been forced to close as a result.
The decline in production is attributed to low rainfall, the land freezing over at the beginning of the year, and the over-usage of groundwater resources.
“Everywhere received only 50% of rain, and in agricultural areas this is a major problem,” said Dr Abdullah Droubi, Director of Water Resources at the Arab League’s Arab Center for the Studies of Arid Zones and Dry Lands (ACSAD) in Damascus. Other areas received only 15-30% of normal precipitation levels, with the exception of the coastal regions, resulting in an average of 2 inches or less between September 2007 and April 2008, according to the United States Department of Agriculture’s Foreign Agricultural Service (FAS).
The water shortage is most severe in the northern governorates of Al Raqqah, Al Hasakah and Aleppo, which account for 75% of the country’s wheat production. The problem is further compounded by Syria obtaining an estimated 85% of its renewable water from the Euphrates, Tigris and Orontes rivers, but with poor rainfall in neighboring Turkey, where the rivers originate, Syria is struggling to meet its water needs.
“They are trying to irrigate some places with supplementary water and from ground water, but as ground water is not recharged, it is a closed cycle - no precipitation means groundwater will decrease,” said Droubi. Utilizing ground water also means less water flows into lakes and rivers, as well as increasing the salinity of ground water reserves.
Pollution, inefficient usage of water and above all a surging population, growing at 2.11% a year, is putting further strain on resources. Additionally, demand for domestic potable water is growing at 4.5% a year and consumption is expected to increase by 40% a year over the next 15 years, according to research by Makram Shakhshir at the University of Damascus.
The problem is particularly acute in urban areas such as Damascus, home to six million people, a third of the country’s population.
The growth of Damascus has impacted directly on the city’s water table as the capital expanded from 1,900 hectares in 1945 to 8,500 today. The nearby Ghuta Oasis, a prime source of water and arable land, has also shrunk, from 25,000 hectares to 10,000 hectares, and continues to lose some 200 hectares per annum as the city expands outwards.
The Barada water basin, located under Greater Damascus, has also retreated in the past 20 years, from 50 meters below ground to 200 meters. Some experts suggest this could this could drop to 400 meters in the next 20 years, exacerbated by some 87% of the 25,000 wells around Damascus being illegal, according to Francesca de Chatel, author of Water Sheikhs and Dam Builders. Furthermore, with Damascus’ ground water table shrinking, sewage is reportedly seeping in and contaminating the water below.
With greater demand and a rising population, Syria’s water problems are only likely to get worse, said Droubi. “Drought is a very big issue in the region and related to climate change, but no one knows to what extent. As for the future, the region will suffer from more drought and lowering precipitation - a 20% reduction in 50 years is one scenario,” he said.

Walking a fine line

To offset the crop reduction, Syria received 190,000 tons of wheat in aid from Abu Dhabi, and canceled a deal with Egypt to exchange 176,000 tons of wheat for rice. The government is also dipping into its estimated 4 to 5 million tons of wheat reserves to keep bread affordable as other food prices have risen by an average of 20% in the last six months, according to the World Food Programme.
“Rice went from 20 SYP ($0.40) to 120 SYP ($2.25) a kilo; olive oil has also risen in price, which we have for breakfast, lunch and dinner. People are hurting,” said Yassir Hamod, a storeowner in Damascus.
To counter rising prices, the government raised public salaries by 25% earlier this year, but with accommodation and energy costs also surging, it may be only a matter of time before people take to the streets to protest, as has occurred in 30 countries around the world over rising food costs.
“We have not seen real repercussions from the rise in prices,” said a political analyst with close ties to the Syrian government. “Maybe in February or March 2009 when people feel the repercussions of winter fuel costs coupled with food expenses, here is a test, so we may witness some disturbances but the crisis is not yet mature.”
Nevertheless, with so many issues converging at once, Syria is struggling to find the right balance between keeping the populace placated through cheap food and fuel - spending an estimated 15% of GDP on fuel subsidies alone - and implementing reforms that will phase out subsidies that have been a mainstay of the Baathist socialist system. Finance Minister Muhammad al-Hussein was quoted in April as saying removing bread subsidies is a “red line,” particularly as consumption of bread has increased as other staples have risen in price. But with the wheat crop half the level of domestic demand, Syria could use up much of its wheat reserves this year alone, forcing the country to buy on the international market, where prices have risen 83% over the past year. Such an outcome would have an immediate impact on Syria’s budget deficit, which was 10% of GDP last year. Furthermore, with Syria now a net importer of oil but with demand for oil rising as well as for electricity, up 5% in the first half of 2008, the budget deficit is expected to soar this year.
“It is a mounting crisis and measures are minimal compared to the extent of the crisis,” the analyst said. “The government doesn’t have a clear view on how to manipulate price rises and salaries, it is still very ad hoc and experimental. The government will support employees, but leave to the rule of the market the others,” he added.

Agricultural solutions

It is in agriculture that the biggest changes need to be made however, the biggest net user of water with some 45% of the sector irrigated, a figure hydrologists consider an inefficient usage of water. And with the state the sole buyer of wheat, barely, sugar beet, millet and cotton, the onus is on the government to reform.
“The debate in Syria is what priority agriculture should take,” said the analyst. “In principle, what is needed is a revision of the state plan for agriculture regarding the distribution of crops and harvests.”
The government has already embarked on a scheme to reduce cotton production to solely cater for local needs, particularly as cotton is highly water-intensive as well as accounting for nearly 25% of the total global insecticide market, a further cause of land and water degradation. However, Sukkar said agriculture is still operating along traditional lines as land reform has not been implemented.
“We are faced with constraints, such as land reform laws which put a ceiling on ownership and prevents mechanization of agriculture,” he said. “Law 10 of 1986 allowed joint public-private projects in agriculture, the government allocating 25% in land allocation and 75% private. It was meant to encourage commercial agriculture but it didn’t work, it was a failure,” Sukkar added.
In reforming other areas, such as reducing production of certain crops like tobacco and cotton, it will be a case of losing export dollars but at the same time helping to ensure water sources, said Droubi.
“I say that water policy should be more important than politics, as water decides economic development in the country, but this is lost in bureaucracy and the public sector is not at the right level,” Droubi said. “We need a technical revolution and support from developed countries, especially as the trouble in the region will impact on the Europe and the USA,” he added.
One solution put forward is for Syria to build desalinization plants. “It was discussed during the peace process and has good potential,” said the analyst. But with prices tags of $1.5 billion upwards for a facility, as well as the time needed for construction, the suggested solution for the short term is improved water usage, stopping leakages, and public awareness campaigns.
“One of the key issues is people are wasting water as there is not a culture of saving resources,” said Poul Gadegaard, Team Leader of the Syrian Enterprise Business Centre. “The government is more focused on petrol and diesel than water, but it should be the other way around. Water prices should rise as people need to learn to economize; I think this is a big, big problem.”


Syria’s water woes go beyond crops and potential social unrest to geopolitics. Hydropolitics is the proverbial 1000lb gorilla in the room that somehow gets overlooked amid the region’s ongoing political problems.
“Water should be a top priority now, we are not in the 1960s or ‘70s. We can see that the situation is dropping very fast, and there is no time to even think of a solution,” said Droubi. “Cooperation is needed on a regional level.”
Some progress has been made, with Syria, Turkey and Iraq earlier this year agreeing to establish an institute to find solutions to water and environmental issues between the three water-linked countries.
“Where political relations have had an impact on the water crisis is Turkey allowing more water through its dams to Syria,” said the analyst. But in rain starved southern Syria the issue is still a political one. The Israeli-occupied Golan Heights provide an estimated 30% of the Jewish state’s water, while the water basin connects to Syria, Western Jordan and Northern Israel. Access to the water of the Golan region will be pivotal in any peace discussions between Damascus and Israel, but Syria should not bank on gaining much water the analyst said, despite the Golan’s proximity to Damascus.
“Syria cannot expect big amounts of water to come from this area. I don’t think the Golan will add much political speaking – Syria should look for a solution elsewhere,” said the analyst.
Ultimately, unless a multi-pronged solution to Syria’s water woes is enacted – politically, socially and economically - the country could face rising socio-economic problems just as Syria is opening up to the world.

Graphs, charts and satellite images courtesy of the United States Department of Agriculture’s Foreign Agricultural Service. Photographs by Paul Cochrane.

Lebanon vs. Syria: The battle to be the region’s playground

Commentary – Executive magazine

Unlike the heady summer of 2006, this year’s season is hardly a memorable one. It was back to business as usual, and as the summer winds down and tourists pack their bags to head home, the tourism sectors of Lebanon and Syria are no doubt pleased there actually was a summer season.
That Lebanon needed a calm summer far more than Syria is a given, particularly following the July war and the ensuing 18-month political debacle. But Syria has also benefited from greater stability in Lebanon, especially when it comes to attracting tourists from the West, who have a tendency to lump the Levantine countries together and avoid the region if there is a crisis.
Both countries were therefore lucky that the May clashes and the resulting Doha Agreement happened when it did, giving ample time for tourists to plan a summer visit.
The big difference between Lebanon and Syria’s tourism sectors however is that Syria is beating Lebanon hands down when it comes to attracting tourists.
Earlier this year Syria made the sound decision to advertise in the Gulf - bar Saudi Arabia -and the county is resultantly chockablock with Khaliji (Gulf) tourists, reflected in the joke circulating around Damascus that if you want to get a taxi outside any of the major hotels you have to wear a white jellaba or otherwise you’ll never get a ride.
The other noticeable difference is that Syria is getting tour groups by the busload, sweating their way around Damascus’ old city and the country’s numerous historical sites. Indeed, sitting in the lounge area of a hamam after a rigorous scrub one sultry August afternoon, I was taken aback by a dozen South American tourists that swarmed in and started snapping away at everything in sight. My fellow hamam clientele also seemed a little bewildered, with a chap opposite me rolling his eyes. But as soon as all the ajnabi (foreign) tourists left, he then thrust a camera in the hands of a hamam attendant to take a photo of himself bedecked in towels, and then asked me to join him. Ahmed, as he introduced himself, was from Libya and marvelled at what Syria had to offer, regaling me with his trip around the country.
Lebanon on the other hand doesn’t seem to be doing much to attract tourists other than appealing to expatriate Lebanese to come home for the summer. True enough expat Lebanese spend a bundle when they are over here, as a trip any night of the week to Sky Bar and downtown shows, but Lebanese returnees with foreign passports aren’t exactly tourists, particularly as most stay with friends or family. And while Khalijis are back on the streets of Beirut, the tour groups are conspicuously absent. It is quite clear Lebanon needs to develop a tourism plan and start marketing the country globally.
After all, if tiny Dubai with just shopping malls and flashy hotels can attract 6.4 million tourists a year, then Lebanon can surely boost figures from an estimated 1.5 million, especially if a modicum of stability prevails.
Lebanon has much to offer, and has a clear advantage over Syria when it comes to quality accommodation, restaurants and services. That isn’t to say that Syria doesn’t have the latter, but the country is desperately short of hotel rooms, reflected in a supply gap of 2 million nights per year in the four to five-star range.
But while Lebanon has few plans to boost tourism numbers, Syria aims to turn the country into a prime tourism destination, with 377 investment projects underway worth some $3.3 billion and international chains clamoring to get in. Damascus has also offered three huge locations for tourism development that are expected to attract up to $15 billion in investment.
How successful Syria’s tourism developments have been so far is reflected in the stats, with tourism numbers surging from 2 million in 2004 to some 4.6 million last year, spending $2.8 billion and accounting for 14.5% of the country’s GDP. Of the tourist numbers, 73% were Arabs, a figure that has increased 15% since 2005, and some 500,000 were from Iran, predominantly coming on pilgrimage. As Faisal Najair, director of Damascus’ Tourism Department was quoted as saying: “We hope to make Syria a resort for all Arab and Gulf tourists.”
With such developments underway, Syria could soon surpass – if it hasn’t already – Lebanon as the preferred destination in the Levant for higher-end tourism and even tourism of the more dubious kind. According to reports, the number of super nightclubs in Damascus has soared in the last three years from 15 to 40.
It’s time Lebanon, for once, took a leaf from Syria’s book if it wants to remain the region’s playground, as well as give the economy a much need boost.

Friday, August 15, 2008

Drug Financing, Money Laundering and Corruption Abound in Afghanistan

The Pakistani side of the climb up to the Khyber Pass.
Photo by James Molliso, Wikipedia Commons

Money Laundering Bulletin July/Aug 2008

After the US-led invasion in 2001 to overthrow the Taliban, Afghanistan took some important steps to curb money laundering and terrorist financing. The continued conflict, the profit that impoverished farmers can earn from poppy cultivation and entrenched corruption have, however, rendered these developments largely ineffectual, says Paul Cochrane.
In 2004, Afghanistan enacted anti-money laundering (AML) and counter terrorist financing (CTF) law, which also set the parameters for a Financial Investigation Unit (FIU). But instability, coupled with Afghanistan being the world’s top opium supplier, has stymied these measures. Corruption is wide spread, the government has minimal control over much of the country, and borders are porous despite attempts by NATO to better regulate entry points. In addition, there are concerns such as those aired by the International Crisis Group when it told the US House Foreign Affairs Committee last October that “Afghanistan is in danger of becoming a failed state, in part because it is in danger of becoming a narco-state.”
Following the installation of the Islamic Republic of Afghanistan led by President Hamid Karzai, the state was reorganized under a new constitution, and by 2003 the Central Bank, Da Afghanistan Bank (DAB), was re-establishing relations with the international community. New licences were issued to commercial banks (currently 15 foreign and Afghan banks), and by late 2004 an AML and CTF legislative framework had been adopted designed to meet the recommendations of the Financial Action Task Force (FATF).
In 2006, Afghanistan became a member of the Asia Pacific Group (APG), and has observer status in the Eurasian Group. According to the APG Secretariat, the APG will carry out a country evaluation in late 2009. The Central Bank is also to establish a Financial Services Tribunal to review certain decisions and orders of the DAB.
The country’s AML law addresses criminalization of ML and TF, customer due diligence, international cooperation, extradition, and the freezing and confiscation of funds in addition to cross-border currency reporting. Transactions and cash transactions equal or exceeding 1,000,000 Afghani (US$19,890) have to be declared to the FIU, a semi-autonomous unit within DAB established in 2005, which has the legal authority to freeze assets for up to seven days.
According to the US State Department’s March 2008 International Narcotics Control Strategy (INCS) Report, the FIU receives approximately 10,000 large cash transaction reports from financial institutions each month, up from the 4,000 reports received and processed per month in 2006.
The FIU has over 140,000 large transaction reports currently stored in its database that can be searched using a number of criteria, while institutions have to keep records for at least 10 years.
AML examinations have been conducted at all commercial Afghan and foreign banks, up from half assessed last year.
There is reportedly growing awareness of AML requirements in banks, bolstered through DAB’s work with the recently created Afghan Bankers Association (ABA). The ABA has drawn up a “know your customer” (KYC) form that has been adopted by the sector and is providing seminars on identifying suspicious transactions. According to the INCS report, seven suspicious transaction reports were received in 2007 by the FIU, one of which was referred to law enforcement for investigation.
But despite such moves, commercial banks are confined to major cities, resulting in Afghanis relying on money dealers and the hawala system, an alternative remittance system (ARS) popular throughout Asia, Africa and the Middle East. There are over 300 hawaladars in Kabul, with some 100-300 additional dealers in each of the country’s 34 provinces. Hawaladars are supposed to be licensed by the DAB, and from September 2006, a new ARS regulation system was introduced to replace former regulations. The DAB has issued approximately 100 licences in Kabul, and this year embarked on a scheme to register hawaladars in other major cities.
But as the INCS report notes, “Given how widely used the hawala system is in Afghanistan, financial crimes undoubtedly occur through these entities.”
And therein lies the nub of the problem in curbing ML and TF in Afghanistan. Not just better regulating hawaladars, but enforcement of AML and CTF legislation in the face of corruption and the narcotics trade.
“The Afghan AML documents looks good, but it’s going to be really tough to make a dent on the endemic corruption and opium trade that permeates the economy in addition to border issues,” said John Solomon, a Central Asia specialist at World-Check, a British company that runs an intelligence database on financial risk.
According to the April 2008, UNODC Illicit Drug Trend Report, Afghanistan accounts for 93 percent of the global annual output of opium, utilizing 4 percent of the country’s farmland and involving 14 percent of the population. Warlords and the Taliban benefit directly and indirectly from the trade, said Solomon, issuing an usher tax on opium production of up to 20 percent, 15 percent on processing at laboratories, and 15 percent on transport. Furthermore, with such large amounts of money involved, there is suspicion that the opium trade is linked with the upper strata of the political establishment as well as law enforcement agencies.
“The Anti Narcotics chief, or police chief, gets an official salary of US$60 a month, and to land a job like that there are bidding wars reaching as high as US$100,000 for a six-month appointment, so clearly there must be bribes involved, and related to the opium trade,” said Solomon.
He added that there was anecdotal evidence that drug money is being laundered through purchasing real estate in Kabul, particularly in the upmarket and “surprisingly expensive” area of Sherpa.
But for more extensive ML related to opium, observers say the money and drugs flow out of the Central Asian countries to the North of Afghanistan, through neighbours Pakistan and Iran, and also via Dubai. Solomon added that there were reports that Ariana Afghan Airlines is being used to smuggle drugs and money.
To counter cross-border movements of people, weapons, money and cash, the NATO-led International Security Assistance Force in collaboration with the Afghan and Pakistan intelligence services embarked this year on the first of six joint intelligence centres to be built on either side of the Durand Line. But with borders of 3,435 miles, curbing illegal crossings will prove difficult.
“Most of the border is not policed or regulated in anyway, and there are loads of smuggling routes so this initiative will not solve the problem,” said Solomon.

Tuesday, August 05, 2008

Content Shift

Commentary – Executive magazine

A RECENT TRIP to London and Rome brought home how precarious the future of newspapers is in Europe, particularly in the capitals where commuters are inundated with free copies of tabloid newspapers.
Glancing around at fellow passengers on the London Underground, few were reading ‘normal’ newspapers while every other person was flicking through freebie Metro - which is to be found in most European capitals – or sister-paper London Lite.
Light these newspapers (if you can call them that) certainly are, all celebrity news orientated with a splash here and there of local news; it was as if Britain were in no way involved on the international stage, or in Iraq and Afghanistan.
The rise of these dailies have hit the national newspapers doubly hard, struggling as they are for advertising in the midst of an economic slowdown while trying to retain a readership in an era of immediate news. This has had a direct impact on the news the papers are producing, with newspapers jumping on the bandwagon of reduced hard news and foreign coverage in favor of the sensational and glamorous. All these factors thrown together have resulted in gloomy prospects for the industry.
Total sales of national newspapers in the UK are down 2% year on year, with broadsheets falling 3.4%, while the tabloid press has only dropped 1.2%. In the USA it is a similar story, with all newspapers reporting a drop in sales, bar a few exceptions, with total newspaper advertising, combining print and online revenues, falling 9.4% last year.
Less disheartening is the fact that there are still people around who want serious news, with The Financial Times’ circulation growing 2.1% while the Wall Street Journal’s circulation of 2.1 million copies has risen 0.4% over the past year.
Of concern however is that the increased commercialization and sensationalism of newspapers is leading to much larger papers, page wise, to give people supposed value for money – with some Sunday editions weighing in at nearly 2 kilos – but written by a near skeleton staff and almost devoid of original content. This has led to what Nick Davies, author of “Flat Earth News,” has called ‘churnalism’.
In a study Davies carried out with Cardiff University on the sources for articles in British newspapers over a two-week period, they found that 60% of stories in the more serious newspapers were wholly or mainly wire copy (i.e. Reuters, Associated Press or the UK’s Press Association) or from PR firms, 20% had clear elements of wire copy or PR, and 8% were from uncertain sources. That left only 12% of articles that were actually researched by journalists in person or over the phone - real journalism in other words.
But with Britain now having more PR people than journalists (47,800 vs. 45,000), it is perhaps no real surprise that PR is having an impact on a sector that is desperate for content while at the same time slashing their budgets for staff and expenses. Of further concern in our globalized world, and naturally for the Middle East, is that foreign coverage is on the decline. In 1970, for instance, CBS had three full-time correspondents in Rome alone, but by 2006, the entire US media, print and broadcast sector had only 141 foreign correspondents to cover the whole world.
While this is all bad news, particularly for newspaper journalists, it has meant that other media and entertainment outlets are picking up the slack.
For instance, a recent PricewaterhouseCoopers (PWC) survey of 15 global media markets, from online, TV, and newspaper advertising to theme park and cinema ticket sales, estimated that these markets were worth $1.6 trillion, and will be worth $2.2 trillion by 2012.
The ad battle between online publications and newspapers is where things will get the bloodiest though, with PWC predicting that by 2012, newspaper print ads will be worth $123 billion, only $3 billion more than online advertising, while newspaper ads and circulation is expected to rise from $186 billion last year to $208 billion. Notably, where newspaper circulation is dropping, in the US, UK and Europe, there is to be a rise in the emerging markets of China and India. So while new media will make inroads everywhere, old media may see an upturn in newer markets.
The question that plagues journalists and people that like to be kept well informed though is what kind of content these new publications will have as the battle between new and old media takes on epic proportions – heavy on quantity but not much quality appears to be the obvious conclusion.
Ultimately, what is likely to happen is that there will be an upswing in demand for specialized and niche publications catering to people’s specific business and personal interests, while general news becomes more marginalized, slotted in-between ‘churnalism’, saucy sex scandals and photo shoots of what celebs were wearing at some cocktail bash.