Sectarian political system costs each Lebanese citizen nearly $24,000 per year

25 February 2008

BEIRUT: Lebanon's sectarian-based political system has caused it serious economic loss, to the tune of almost $24,000 in annual per-capita income, and prevented it from achieving a better democracy, according to a new economic study conducted at the American University of Beirut (AUB).

Referring to a paper entitled "The Case of Lebanon: Trapped by Consociationalism?," professors Samir Makdisi and Mark Marktanner, from the Institute of Financial Economics at AUB, concluded that transitioning from consociationalism, or sectarian-based power-sharing, to a full-fledged secular democracy "would provide the necessary conditions for long-term stability and sustained development, thus opening up the full potential for the development of Lebanon."

Marktanner gave a presentation of the paper at a workshop held on February 19 at the Institute of Financial Economics and the Department of Economics at AUB. The work was the result of collaboration between himself, Makdisi and professor Fadia Kiwan from Universite Saint Joseph. The workshop attracted a host of academics, specialists and graduate students from AUB and beyond. It was opened by professor Simon Neaime, the chair of the economics department, who said the event was the first in a series of workshops that would focus on research projects being carried out at the Institute.

Marktanner and Makdisi's paper concluded that Lebanon's sectarian-based system has always invited external interventions. Moreover, Lebanon's location in a neighborhood that is rife with autocracies and seriously impacted by the Israeli-Arab conflict, in addition to its economic dependence on the oil wealth of neighboring countries have stalled its economic and democratic progress.

The paper concluded that if Lebanon had been immunized against external interventions with a secular democratic system, the income per capita would be almost six times its current level. In other words, each Lebanese would be making an estimated $23,515 per year instead of the $4,000 they are currently making on average.

The economists also found that the weakness in the system was also reflected in the country's poorer-than-projected performance in a number of other economic and development indicators, including democratic practice, investment and manufacturing. - The Daily Star

Copyright The Daily Star 2008.