The David Rubenstein Show: Ajay Banga
World Bank Group President Ajay Banga says the best way to eliminate poverty is through job creation. As 1.2 billion young people in emerging markets enter the workforce, he emphasizes the importance of equipping them with the skills and opportunities they need to succeed. In an interview on The David Rubenstein Show: Peer to Peer Conversations, Banga also discusses the World Bank's close collaboration with the IMF and the possibility of lifting its ban on funding nuclear power projects. This interview was recorded March 20 at the Economic Club of Washington, DC. (Source: Bloomberg)
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Los Angeles Times
4 hours ago
- Los Angeles Times
Lebanon aims to lure back wealthy Gulf tourists to jumpstart its war-torn economy
BEIRUT — Fireworks lit up the night sky over Beirut's famous St. Georges Hotel as hit songs from the 1960s and '70s filled the air in a courtyard overlooking the Mediterranean Sea. The retro-themed event was hosted last month by Lebanon's Tourism Ministry to promote the upcoming summer season and perhaps recapture some of the good vibes from an era viewed as a golden one for the country. In the years before a civil war began in 1975, Lebanon was the go-to destination for wealthy tourists from neighboring Gulf countries seeking beaches in summer, snow-capped mountains in winter and urban nightlife year-round. In the decade after the war, tourists from Gulf countries — and crucially, Saudi Arabia — came back, and so did Lebanon's economy. But by the early 2000s, as the Iran-backed militant group Hezbollah gained power, Lebanon's relations with Gulf countries began to sour. Tourism gradually dried up, starving its economy of billions of dollars in annual spending. Now, after last year's bruising war with Israel, Hezbollah is much weaker and Lebanon's new political leaders sense an opportunity to revitalize the economy once again with help from wealthy neighbors. They aim to disarm Hezbollah and rekindle ties with Saudi Arabia and other Gulf countries, which in recent years have prohibited their citizens from visiting Lebanon or importing its products. 'Tourism is a big catalyst, and so it's very important that the bans get lifted,' said Laura Khazen Lahoud, the country's tourism minister. On the highway leading to the Beirut airport, once-ubiquitous banners touting Hezbollah's leadership have been replaced with commercial billboards and posters that read 'a new era for Lebanon.' In the center of Beirut, and especially in neighborhoods that hope to attract tourists, political posters are coming down, and police and army patrols are on the rise. There are signs of thawing relations with some Gulf neighbors. The United Arab Emirates and Kuwait have lifted yearslong travel bans. All eyes are now on Saudi Arabia, a regional political and economic powerhouse, to see if it will follow suit, according to Lahoud and other Lebanese officials. A key sticking point is security, these officials say. Although a ceasefire with Israel has been in place since November, near-daily airstrikes have continued in southern and eastern Lebanon, where Hezbollah over the years had built its political base and powerful military arsenal. As vital as tourism is — it accounted for almost 20% of Lebanon's economy before it tanked in 2019 — the country's leaders say it is just one piece of a larger puzzle they are trying to put back together. Lebanon's agricultural and industrial sectors are in shambles, suffering a major blow in 2021 when Saudi Arabia banned their exports after accusing Hezbollah of smuggling drugs into Riyadh. Years of economic dysfunction have left the country's once-thriving middle class in a state of desperation. The World Bank says poverty nearly tripled in Lebanon over the past decade, affecting close to half its population of nearly 6 million. To make matters worse, inflation is soaring, with the Lebanese pound losing 90% of its value, and many families lost their savings when banks collapsed. Tourism is seen by Lebanon's leaders as the best way to kickstart the reconciliation needed with Gulf countries — and only then can they move on to exports and other economic growth opportunities. 'It's the thing that makes most sense, because that's all Lebanon can sell now,' said Sami Zoughaib, research manager at the Policy Initiative, a Beirut-based think tank. With summer approaching, flights to Lebanon are already packed with expats and locals from countries that overturned their travel bans, and hotels say bookings have been brisk. At the event hosted last month by the tourism ministry, the owner of the St. Georges Hotel, Fady El-Khoury, beamed. The hotel, owned by his father in its heyday, has acutely felt Lebanon's ups and downs over the decades, closing and reopening multiple times because of wars. 'I have a feeling that the country is coming back after 50 years,' he said. On a recent weekend, as people crammed the beaches of the northern city of Batroun and jet skis whizzed along the Mediterranean, local business people sounded optimistic that the country was on the right path. 'We are happy, and everyone here is happy,' said Jad Nasr, co-owner of a private beach club. 'After years of being boycotted by the Arabs and our brothers in the Gulf, we expect this year for us to always be full.' Still, tourism is not a panacea for Lebanon's economy, which for decades has suffered from rampant corruption and waste. Lebanon has been in talks with the International Monetary Fund for years over a recovery plan that would include billions in loans and require the country to combat corruption, restructure its banks, and bring improvements to a range of public services, including electricity and water. Without those and other reforms, Lebanon's wealthy neighbors will lack confidence to invest there, experts said. A tourism boom alone would serve as a 'morphine shot that would only temporarily ease the pain' rather than stop the deepening poverty in Lebanon, Zoughaib said. The tourism minister, Lahoud, agreed, saying a long-term process has only just begun. 'But we're talking about subjects we never talked about before,' she said. 'And I think the whole country has realized that war doesn't serve anyone, and that we really need our economy to be back and flourish again.' Chehayeb writes for the Associated Press.
Boston Globe
a day ago
- Boston Globe
Lebanon aims to lure back wealthy Gulf tourists to jumpstart its war-torn economy
Now, after last year's bruising war with Israel, Hezbollah is much weaker and Lebanon's new political leaders sense an opportunity to revitalize the economy once again with help from wealthy neighbors. They aim to disarm Hezbollah and rekindle ties with Saudi Arabia and other Gulf countries, which in recent years have prohibited their citizens from visiting Lebanon or importing its products. Advertisement 'Tourism is a big catalyst, and so it's very important that the bans get lifted,' said Laura Khazen Lahoud, the country's tourism minister. On the highway leading to the Beirut airport, once-ubiquitous banners touting Hezbollah's leadership have been replaced with commercial billboards and posters that read 'a new era for Lebanon.' In the center of Beirut, and especially in neighborhoods that hope to attract tourists, political posters are coming down, and police and army patrols are on the rise. Advertisement There are signs of thawing relations with some Gulf neighbors. The United Arab Emirates and Kuwait have lifted yearslong travel bans. All eyes are now on Saudi Arabia, a regional political and economic powerhouse, to see if it will follow suit, according to Lahoud and other Lebanese officials. A key sticking point is security, these officials say. Although a ceasefire with Israel has been in place since November, near-daily airstrikes have continued in southern and eastern Lebanon, where Hezbollah over the years had built its political base and powerful military arsenal. As vital as tourism is — it accounted for almost 20% of Lebanon's economy before it tanked in 2019 — the country's leaders say it is just one piece of a larger puzzle they are trying to put back together. Lebanon's agricultural and industrial sectors are in shambles, suffering a major blow in 2021, when Saudi Arabia banned their exports after accusing Hezbollah of smuggling drugs into Riyadh. Years of economic dysfunction have left the country's once-thriving middle class in a state of desperation. The World Bank says poverty nearly tripled in Lebanon over the past decade, affecting close to half its population of nearly 6 million. To make matters worse, inflation is soaring, with the Lebanese pound losing 90% of its value, and many families lost their savings when banks collapsed. Tourism is seen by Lebanon's leaders as the best way to kickstart the reconciliation needed with Gulf countries -- and only then can they move on to exports and other economic growth opportunities. Advertisement 'It's the thing that makes most sense, because that's all Lebanon can sell now,' said Sami Zoughaib, research manager at The Policy Initiative, a Beirut-based think tank. With summer still weeks away, flights to Lebanon are already packed with expats and locals from countries that overturned their travel bans, and hotels say bookings have been brisk. At the event hosted last month by the tourism ministry, the owner of the St. Georges Hotel, Fady El-Khoury, beamed. The hotel, owned by his father in its heyday, has acutely felt Lebanon's ups and downs over the decades, closing and reopening multiple times because of wars. 'I have a feeling that the country is coming back after 50 years,' he said. On a recent weekend, as people crammed the beaches of the northern city of Batroun, and jet skis whizzed along the Mediterranean, local business people sounded optimistic that the country was on the right path. 'We are happy, and everyone here is happy,' said Jad Nasr, co-owner of a private beach club. 'After years of being boycotted by the Arabs and our brothers in the Gulf, we expect this year for us to always be full.' Still, tourism is not a panacea for Lebanon's economy, which for decades has suffered from rampant corruption and waste. Lebanon has been in talks with the International Monetary Fund for years over a recovery plan that would include billions in loans and require the country to combat corruption, restructure its banks, and bring improvements to a range of public services, including electricity and water. Without those and other reforms, Lebanon's wealthy neighbors will lack confidence to invest there, experts said. A tourism boom alone would serve as a 'morphine shot that would only temporarily ease the pain' rather than stop the deepening poverty in Lebanon, Zoughaib said. Advertisement The tourism minister, Lahoud, agreed, saying a long-term process has only just begun. 'But we're talking about subjects we never talked about before,' she said. 'And I think the whole country has realized that war doesn't serve anyone, and that we really need our economy to be back and flourish again.'
Yahoo
a day ago
- Yahoo
When the Trump Tide Turns: Bukele's Risky Bromance
Nayib Bukele, El Salvadors authoritarian president, brands himself the "worlds coolest dictator." But he oversees an increasingly dismal economy. He seems to think that a strong relationship with Donald Trump, a loan from the International Monetary Fund, and the resumption of mining in his gold-rich nation will help him turn things around. But his priorities are misaligned and shortsighted. To make lasting economic improvements for 6.3 million Salvadorans, Bukele must first clean up the countrys polluted water supply. Bukeles close relationship with Trump has produced short-term financial perks. Shortly after Trump won reelection, El Salvador struck a $1.4 billion loan deal with the IMF without fully reversing Bukeles decision to adopt bitcoin as legal tender. The fund, which previously required a complete about-face on bitcoin during loan negotiations, likely changed its tune due to Trumps support of both bitcoin and Bukele. The loan will help El Salvador manage its public debt, which peaked at 84.9% of GDP in 2023. But if Bukele wants to reverse his countrys worsening poverty rate, further expand the job market, and attract foreign investment, he needs to do more than woo friends in Washington and secure loans. His country needs a diversified economy, workforce education, and more efficient labor markets. These are ambitious aims in their own right. Dirty water could drown them altogether. Due to contamination, less than 12% of the countrys rivers can be used for human consumption, irrigation, or animal life. Over 90% of surface water is contaminated by untreated sewage and agricultural and industrial waste. Nearly half of urban households lack access to running water in their homes, and rural water infrastructure is virtually nonexistent. Many Salvadorans rely on water sources outside their homes, such as rivers or community taps. In the past, these public water sources were war zones where gangs fought to control the countrys limited fresh water supply. Bukeles harsh crackdown on crime, which has left 2% of the nations adult population incarcerated, has vastly improved security, though many prisoners are not afforded a fair trial. Waning gang influence has made it safer for Salvadorans to approach rivers, wash their laundry, and collect drinking water. But dangerous pollution persists. To prevent excrement contamination in rivers and lakes, the government needs to invest in more sewage treatment plants and water piping, especially beyond the capital, San Salvador. Additionally, the government should invest in equipment and personnel to monitor agricultural and industrial runoff. El Salvadors General Water Resources Law, enacted in 2021, does little to reach these aims. Historically, mining has been a major source of water pollution throughout the country, so much so that in 2017, the government banned metal mining, the first such ban in the world. But Bukeles government reversed the ban in December. The move will mostly benefit foreign extraction companies eager to access El Salvadors gold reserves (which Bukele says are valued at $3 trillion), while only a small portion of the earnings will likely stay in-country. Metal mining will further contaminate the countrys largest river, the Lempa, and other water sources with toxins like cyanide, a chemical used for gold extraction. Lifting the mining ban may produce quick cash but will likely thwart El Salvadors future economic stability and the health of its citizens. Bukele is a fan of quick fixes, though. His unconstitutional mass arrest tactics have swiftly brought security to a country once known as the murder capital of the world. His popularity among Salvadorans has soared, but the root causes of El Salvadors violent past have not been resolved. If water security worsens, Bukele may learn, like so many others, how quickly Trump can end a bromance. Though Trump typically praises Bukele for being "very tough on crime" (as he did after Bukele recently offered to jail deportees from the U.S. in El Salvadors mega-prisons), he has also criticized Bukele. During his speech at the Republican National Convention last July, Trump said Bukele is "sending all of his criminals, his drug dealers, his people that are in jails" to the U.S. "Hes trying to convince everybody what a wonderful job he does in running the country. Well, he doesnt do a wonderful job." If low wages and polluted waters send a wave of Salvadoran migrants to the U.S., a frustrated Trump could turn on Bukele in short order. Even the "worlds coolest dictator," who has watched poverty rise during his presidency, cannot afford the political cost of a spiraling economy and an unlivable environment. A recent pat on the back from Trump, a loan from the IMF, and revenues from gold mining wont fix Bukeles problems. Eventually, safe streets will be a small consolation to thirsty Salvadorans. Until Bukele gets serious about water, his countrys economy will continue to falter. Before long, his popularity - at home and abroad - could falter with it. Addison Graham is global affairs correspondent for RealClearPolitics.
