Businessman Marwan Kheireddine says Lebanon’s economy has shrunk by more than two-thirds in the past two years and the poverty level is skyrocketing. But he believes the Middle Eastern country, once a hot spot for celebrities such as Brigitte Bardot and Omar Sharif, can learn a few lessons from what other countries have gone through.
“We can look at the Argentinian model,” Marwan Kheireddine says. “They have gone through a similar meltdown and, more than a decade later, they still have not gotten out of it because they did not implement the right policies.”
Like Many Countries, Lebanon Is Getting Hit with Inflation
Bloomberg recently reported that Argentina is currently at an inflation rate of 58% and climbing. As a result, the news outlet reports that prices of goods are soaring and a new iPhone costs about as much as six months’ rent.
“We can look at Greece, which just recently paid off, or is about to pay off, its last debt to the World Bank, and it has recovered and its economy is growing,” Marwan Kheireddine says. “We have a lot of examples that we can learn from.”
While Marwan Kheireddine acknowledges that each country has its unique challenges, he views Lebanon’s issues as relatively easier. “The Republic of Lebanon is a very rich state that has a lot of assets that it is not tapping into or managing properly,” Marwan Kheireddine says. “And the debt can be dwarfed when you compare it to those assets and especially if you run them efficiently to generate cash flows out of them.”
Marwan Kheireddine Is Looking to the Private Sector to Boost Lebanon’s Economy
“The private sector has forever been the driving force behind the growth in the Lebanese economy,” says Marwan Kheireddine, who added jobs to the private sector through AM Bank and Virgin Megastores. “As a matter of fact, for the last 30 years, the private sector has been pulling the economy up, and corruption that government agencies are infested with pulls the economy down.”
Marwan Kheireddine says letting the private sector thrive could energize Lebanon’s economy. He adds that Lebanon’s politicians and political system must address losses in the financial system, because the country’s government has been in the red for three decades. Lebanon can’t afford to lose more members of its workforce, according to the AM Bank chairman. Many citizens have left the region to seek opportunities elsewhere, which Marwan Kheireddine believes only adds fuel to the region’s economic strife. To make matters worse, the financial expert states that many Lebanese people have lost their social security benefits, they’re battling food shortages, and they’re losing hope in the government.
“Since the crisis started, specifically in March 2020, the government of Lebanon decided to default on its debts,” he explains. “When they defaulted on the government debt, they announced that they will be holding negotiations in good faith with the debtors. However, two years and some months later, that has still not happened.”
Marwan Kheireddine: Looking to the Past Can Benefit Lebanon’s Future
“We have a lot of heroes that Lebanon can look up to,” says Marwan Kheireddine, who feels Lebanon’s founding fathers ran the country better than his generation has. “What is important now is having the existing political leadership agree upon running the country with less corruption and a clear recovery plan to move us out of the dilemma, out of the fix, out of the bind, that we are in.”
Marwan Kheireddine shares a family legacy of bolstering Lebanon’s economy through multiple generations. More than 100 years ago, his grandfather was selected by the people of his hometown to be the person of trust to house valuables for safekeeping.
“I come from a very small community called the Druze, and we are a very, very small minority, a religious minority, and we have our sacred religious books,” he says. The Druze of Palestine deposited their religious books at his grandfather’s home in 1948.
The tradition of looking after the Lebanese people’s assets continued when Marwan Kheireddine’s father officially launched AM Bank in 1980.
Despite Lebanon’s economic turmoil, Marwan Kheireddine remains hopeful that the country will thrive again.
“I think Lebanon will be in a much better place five to 10 years from now,” he says. “Political leadership has realized that they cannot continue running Lebanon in a very uncoordinated and corrupt manner. GDP [gross domestic product] has made them all realize that they need to agree on how to move forward with providing the right environment to the private sector.”