Germany is to present a multi-billion-dollar proposal to Lebanese authorities that would see the Port of Beirut being rebuilt, reports Reuters, citing two unnamed sources.
The cash offer, which would come with conditions, is part of an international effort to encourage Lebanon’s political elite to form a government capable of warding off financial collapse, two sources said.
It was last August that a huge port warehouse explosion – one of the biggest non-nuclear explosions ever – killed 200 people, injured thousands and destroyed entire neighbourhoods in Beirut, creating a huge crater at the port and destroying much of the infrastructure.
Two diplomatic sources with knowledge of the plans informed Reuters that Germany and France were competing to lead reconstruction efforts. Berlin was expected to outline its proposal today, April 7th. It would in principle include support from the European Investment Bank (EIB) to help fund the clearing of the area and reconstruction facilities, the sources claimed.
An EIB spokesman said it was aware of the proposal put forward by the port of Hamburg and its consultancy team for the reconstruction of the port of Beirut and surrounding areas, but added that “there currently is no financing offer by the EIB. Any EIB financing would be subject to due diligence and have to follow the Bank’s usual processes for such operations”. He noted that it would also need to comply with the EIB’s procurement guidelines, environmental and social standards.
One of the sources estimated that the EIB funding could be in the range of between €2bn and €3bn.
Germany’s ambassador to Lebanon, Andreas Kindl, confirmed a proposal would be made this week to redevelop Beirut port and nearby areas. The plan had been drawn up by several private companies who would hold talks in Beirut to present it, he said.
“Germany and France want first to see a government in place committed to implementing reforms. There is no other way around it and this is good for Lebanon”, one of the diplomatic sources said.
At the moment, Prime Minister-designate Saad al-Hariri and President Michel Aoun have been unable to agree on a ministerial line-up. The outgoing cabinet, which quit after the explosion, has stayed on in a caretaker capacity.
Germany’s proposal would look to redevelop more than 100 hectares in the surrounding area in a project that the two diplomatic sources said would be along the lines of the post-war reconstruction of central Beirut. The plan would involve the creation of a publicly-listed company similar to Solidere, which was set up by former Prime Minister Rafik Hariri in the 1990s and remains on the Lebanon stock exchange.
The sources put the project cost at anywhere between $5bn to $15bn, and said it could create as many as 50,000 jobs.
The Lebanese official said France and French ports and container shipping group CMA CGM were also interested in the reconstruction project. One of the diplomatic sources said that France had sent several missions, including one in March that included CMA CGM, that showed an interest in playing a role in the reconstruction. That mission focused on specific clear-up operations rather than a broader redevelopment.