Fresh ideas from the fresh ministers. Unbridled ambition or pitiful naiveté?
Perhaps it’s because they never really got to navigate the labyrinth of governance in Lebanon, but Gebran Bassil, our new minister of Telecommunications and Alain Tabourian, our new minister of energy and water, –both Aoun loyalists– have brandished some sensible plans for their tenures.
They both saw something terribly wrong in the way things are going and suggested fixes, perhaps immaturely, and perhaps off the top of their minds. But we’re talking about the kind of obvious stuff that makes you wonder: Why didn’t anyone try to do something about this before?
Mr. Gebran Bassil saw that Lebanon has one of the highest cellphone rates in the world (30 cents per SMS!!), and made fee reduction a priority. Mr. Alain Tabourian, a succesful businessman and philantropist, saw that the government is paying way too much subsidy for electricity and came up with a plan: Let’s charge electricity hoggers (Like ABC mall in the picture above) market prices while keeping the subsidy for those who use less power like your average mom & pop stores. To me that makes perfect sense and it’s about time(although I think exceptions should be made for the Lebanese industry to keep it competitive.)
Perhaps the ministers are just being naive, or worse, populists for political gains in the next elections. But at least they have started a conversation about matters the Lebanese really care about.
Hello, my name is Mustapha and I've been blogging about Lebanese society, business and politics since February 2005.
These are not “solutions.” The second one in particular is a bad idea, and a blatantly political one at that.
I’d like to see Mr. Tabourian tell his Hezbollah allies that we need better payment collection (even privatize that aspect).
In reality this is all obvious — and damaging — populism.
In reality, the only sensible solution for these two ministries is privatization. The Telecom’s prices are in part due to the fact that the percentage of penetration in Lebanon is lower than average in the ME.
As for EDL, it’s a constant hemorrhage in the budget, and charging successful retailers while maintaining subsidies and not collecting at all from certain parts in the country (especially as other parts of the country are already taking the load of compensating the loss of revenue from those non-paying parts) is worse than applying a band aid to cure cancer. It’s flat-out insulting.
Tony,
While I think privatization is indeed the best solution, I can’t see why you’re resisting the idea of raising prices for “successful retailers”, since it would also be the eventual outcome of privatization (private companies will eventually charge market prices for the electricity right?)
Also, we need more cellphone companies for competition to reduce prices. I live in an African country and we have 6 cellphone providers and now Vodafone has joined the fray to make them 7.
30 cents an SMS is outrageous in the age of VOIP and chatting over the phone. While I do support Mr. Seniora, i find his attitude to the cellphone industry very obsolete.
Although it’s probably populism, it is a refreshing change of topic from the usual to actual issues that don’t concern factional strength… It’s the kind of thing politicians in a functioning country without deep sectarian divides would try to gain votes on.
Well, first off, the EDL solution simply aims to raise prices or reduce subsidies whichever way you want to look at it. This is something that has been called for by both finance minister Azour and economy minister Haddad with regards to many subsidized commodities – so nothing new there. Implementing this is where you will run into problems – particularly with EDL. Frankly, the Lebanese know that the FPM owes its ministerial posts to the largess of Hizbollah as a reward for Aoun’s position during the attack on Beirut in May. This is not lost on Tabourian and raising electricity rates, whichever way you want to frame it, is a no no. Do you think only ABC uses so much electricity.
As for the cell issue, I disagree with Tony above – penetration rates are so low perhaps because of hi prices. But there is probably another reason that explains this- basically it is network capacity. It is often said that the government has been under-investing in the telecom sector and is using it purely as a cash cow. The best solution is privatization, but good luck with that as long you have Hizb-Telecom with a carte blanche license to operate whatever telecom network it chooses anywhere in the country (in the name of resistance of course)
There are a couple of things worth mentioning;
1- Hezb’s supporters need to pay for power. That would bring in a cool billion USD.
2- Privatization will not work as long as EDL has so much real estate. Next to BDL, the power company has much unused real estate, worth potentially more than the company’s current debt. They need to spin off those lands, or transfer them to DBL first.
Other than this, good luck to both minister if they are really serious at fixing the problems.
Only one third of the Lebanese people pay their electricity bills.When Zgharta and Dahieh (and HA land) pay their share the problem would be fixed.Stop hiding behind your finger!
Mustapha,
I did not here or notice ant “bright” ideas yet. If Mr. Orange REALLY wants to make a difference, then let’s start with making his ministries totally transparent. Let’s find out why EDL is in such a mess? Could it be that most of the South and Dahia do not pay their bills? Could it be that there are thousands of “ghost” employees that are sucking the EDL dry? Again, let’s not have a premature ej…n every time someone throws out a soundbite!
Let them open the books…Then I’ll wear orange!!
Yi7irk 3ardak Shou Pessimist Mustapha!!
Whatever the ‘Aounists’ do, you’ll always twist it. Anyways… the Future Movement is the last of my worries, their influence is diminishing by the hour. They do hold strong ministries sure, the Finance, commerce… the But you can’t do much without the central bank.
The point is that you can’t have these half solutions intended to maintain subsidies and cell phone monopolies (while also protecting Hezbollah in both cases).
In that sense, while I don’t know what Seniora is thinking (and it isn’t my knee jerk reaction to support him), but I would also refrain from these “bright” ideas if the bottom line is to maintain the same dysfunctional system and put a fresh coat of paint on top.
The notion of “taxing the rich but not the poor” doesn’t work in general. To think that it can be used, selectively, in order to maintain subsidies, is stupidity incarnate.
Talking is a wonderful thing, start acting and we will discuss then.
For the gentlemen who are advancing the issue of non-collection of bills, could you provide some statistics or numbers to back your claims?
Thanks
Just out of curiosity,
do you have statistics detailing who is paying and who is not?
I lived in areas considered “HA” dominated my whole life, and as far as I know we personally as a family never missed a payment, and still never do. I know my neighbours pay their bills.
Please if you have hard evidence detailing payments from all over Lebanon, I would be very interested in reading them.
Thanks
To lira and Anonymous…
Its not about statistics, its a simple math equation:
Beirut uses X KWatt and pays X*100LL
Metn uses Y KWatt and pays Y*100LL
Dahieh or south uses W KWatt and pays?
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oranges always want to give us the impression that they are going to save us, kill corruption, put the best minds and the most wonderfull ideas at the service of the lebanese.. bla bla bla.. some tricks don’t even fool you the first time
Roch,
that s exactly what I am asking. The line is repeated by so many people do you have the W kwatt used and the W*100LL payed by South, Dahyeh, Metn, Beirut etc etc etc.
I am not saying you are right or wrong about the lack of payment. I am seriously interested in knowing what is this line that is used as an axiom (they do not pay for electricity) based on. that is all.
Anonymous,
A few years ago when electricians tried to install meters in the dahia they were attacked and a few people died in the clashes with the army…It is not whether you had paid your bills…”legal” meters are important factors. Most electricity is stolen through the main cables…
Danny and others, how much is the state losing from the alleged non-collection and/or the stated theft through main cables?
Seriously now, a backed up figure.
It’s always amusing to see how Lebanese discussions almost instantly veer off the intended point and straight into political and factional finger pointing. Yes. Tabourian’s plan does make sense. And the sensibility of the plan has nothing to do with Dhahia paying for consumed electricity or not ( and by the way anonymous and Lira, no they don’t pay for electricity. You don’t need numbers. Just go look at the hijack cables all over the place! Sheeesh!).
In most countries if you consume more electricity, you simply pay more per KW consumed. I live in a country where the less I consume the cheaper the KW price is. Big consumers (for big consumer read successful businesses) should never enjoy subsidy (which by social definition is intended for the “not successful”).
And just to make this clear, not paying for a service is theft. Plain and simple.
I am really interested in knowing what is the part of the non-collection loss out of the total losses of EDL caused by the continued use of FUEL power stations instead of gas.
Does it interest anyone or since that might not have to do directly or indirectly with Hezbollah, then it is a non-factor?