Lebanon’s agriculture industry looks to ‘coping mechanisms’ amid virus outbreak
Kanj Hamade is at home, taking turns with his wife over childcare and work periods. The Lebanese University’s assistant professor in agricultural economics is taking stock of a COVID-19 crisis amid the country’s fiscal, banking and political crises.
“It’s still early,” he said. “Production is on-going, agriculture is mechanised. The farmer is alone in the field with little risk of contagion.”
Fresh food, central to Lebanon’s famous diet, is widely available, even if hand sanitiser and surgical masks are scarce. The country’s distribution channels have worked before in crises, including the month-long 2006 Israeli bombardment.
However, social isolation, which is being widely observed, leaves a blurred overall picture. Officials and academics are restricted in collecting information and meeting others. “We’re looking to resume in May,” said Hamade. “By then, we’ll see if farmers were able to plant normally and what kind of coping mechanisms they have used.”
These coping mechanisms, he explained, were still primarily to deal with difficulties sourcing imported seeds, fertiliser and pesticides during the planting season, given dollar shortages and capital controls introduced by banks.
The COVID-19 crisis, Hamade said, has, in a way, helped Lebanese Prime Minister Hassan Diab, in office since January.
“Life is on hold for many people. The situation is dangerous but, overall, it gives the country a break from the financial crisis,” Hamade said. “The government has time to plan, to work under less pressure, to manage both the corona challenge and negotiations with creditors.”
The government is in talks about a $1.2 billion Eurobond it did not repay March 9 and bonds of $1.3 billion due in April and June. With a $90 billion debt — at 170% of GDP the world’s largest — Lebanon’s recession will be deeper in 2020 than the pre-COVID-19 forecast of 5% by consultants Capital Economics.
The Diab government, Hamade argued, has dealt with the virus outbreak fairly well by closing educational institutions on February 29, a week after the first case was confirmed, and by encouraging social distancing, giving a relatively low total of deaths.
“They made one mistake early on, not quickly stopping planes from Iran [the first case arrived by plane from Qom],” said Hamade. “They’ve acted fast [since then]. Politically, they were lucky with this window of opportunity to work on the financial issues.”
Agriculture, with the rest of the private sector, has long suffered as high state spending was funded with high-interest loans from domestic banks attracting deposits from expatriates. Government deficits, Hamade pointed out, persisted even once the balance of payments turned negative after 2011 to reach a 2020 World Bank projection of 21.4% of GDP.
“We need a new model where the banks are directed towards financing productive businesses, including agriculture and the ‘knowledge economy,’ instead of financing the state,” Hamade said. “We shouldn’t rely on rentier interest or real estate sales.”
A strong supporter of Lebanon’s al-thawra — the street protests and civil mobilisation since October 17 — Hamade said he feels transformation coming, even if politicians try to “kick the can down the road” with talk of offshore oil and gas.
“Perhaps during a crisis, people are more willing to think differently. The hole in the central bank’s balance sheet is so big we just cannot go back to where things were,” he said.
If private banks prove slow, agriculture can lead the way but the better the government coordination, Hamade insisted, the better will be the results.
“We may see new investment in dairy production, export-oriented production. Rural areas have options. We need a nexus of activities — agro-food, environmental protection, non-polluting industries, tourism and hospitality. We should look at EU rural development,” he said.
This includes moving light industry from the overcrowded coast. Hamade suggested relocating the famous Almaza beer factory in Beirut’s northern suburb to the Bekaa, freeing strategic land and boosting the rural economy.
Growing up in Beirut and Paris, Hamade studied chemistry at the Lebanese University before turning to agriculture with a scholarship for a master’s degree in Bari before a doctorate at Bologna University on the political economy of Lebanese agriculture and rural areas.
Once back home, he worked as a consultant on rural tourism and integrating people with disabilities and as an activist within the Lebanese Association for Democratic Elections. He began his post at the Lebanese University in 2014.
Hamade has been active in the national tourism strategy, launched in 2015, and seeking diversification from glitzy hotels and illegal beach resorts. The Lebanon Mountain Trail, opened in 2006, created employment for more than 400 people. Food-tourism packages have multiplied. Small-scale agriculture has been showcased by Beirut’s Souk el-Tayeb, established by Kamal Mouzawak in 2004.
Hamade stressed an integrated approach. Multilingual, passionate and informed, he is one of a rising generation of Lebanese seeking change. Right now, he’s keeping busy at home while looking forward to getting some soil on his boots.