Lebanon to ask Russia for help in restoring port, building power plants

Lebanese Prime Minister-designate Saad al-Hariri intended to ask Russia for economic assistance during his visit to Moscow last week, his special representative has said.

German interests and French shipping line CMA CGM have both put forward proposals for reconstructing the port along modern lines.

However, Hariri was seeking Russian help to restore the port in Beirut, which was devastated by a chemical explosion last August that was one of the largest non-nuclear explosions ever seen on earth.

The explosion killed 200 people and caused billions of dollars’ worth of damage

German companies including Hamburg Port Consulting have presented a multi-billion-dollar plan to rebuild the port and neighbouring districts, while CMA CGM also said it was pursuing a plan to restore the port.

However, both projects remain in limbo while Lebanon’s political structure, which was brought into place in an attempt to bring to an end Lebanon’s long-running civil war in the 1970s, hampers the formation of a new and stable administration.

Hariri is a three-time prime minister. He resigned in 2019, but was nominated as prime minister again in October. Unfortunately he cannot agree with President Michel Aoun and therefore has been unable to form a new government.

To that extent, whether any request to Russia for help in the port reconstruction has any prospect of being implemented remains open to doubt.

Hariri’s envoy, George Shaaban, said that the PM would seek Russian support to help address electricity shortages. “There is a need to build new power plants that will be able to supply the country with 24-hour electricity… We will look to Russia and its possible assistance to Lebanon, both in these sectors and others,” Shaaban said. That would include the possibility of Russia supplying vaccines against Covid-19.

CMA CGM had come up with the most aggressive and ambitious plan relating to Beirut, when at the beginning of April it said “let us rebuild Beirut’s port in less than three years”.

CMA CGM’s plan was first outlined to Lebanese authorities in September. It envisages the reconstruction of damaged docks and warehouses, along with port expansion and digitalization, at a cost estimated at between $400m and $600m, according to CMA CGM Lebanon general manager Joe Dakkak.

Dakkak told Reuters earlier this month that the offer “remains on the table”, adding that “our project is a realistic one because the situation is urgent.”

CMA CGM’s restatement of its September 2020 offer came in quick response to a separate German plan to rebuild Beirut’s port and neighbouring districts.

Dakkak said the German initiative was more focused on longer-term real-estate development, and that CMA CGM would be willing to contribute to the port part of that project if it were so invited.

CMA CGM has familial links to Lebanon. The group joined French President Emmanuel Macron in relief efforts in Beirut following the August 2020 explosion. However, the French government is not part of CMA CGM’s reconstruction plan.

CMA CGM is the leading shipping operator at Beirut port, accounting for 60% of volumes, and remains a candidate in partnership with Switzerland-based MSC for the concession to run the container terminal, Dakkak said.

CMA CGM said that it had been told that a tender process to run the container terminal, which had been held up by the political crisis, would be relaunched within weeks.