Exclusive: Germany will propose the reconstruction of the port of Beirut with ‘conditions’

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3/3 © Reuters. A view shows the grain silo that was damaged in a massive explosion in the port of Beirut 2/3

By John Irish, Joseph Nasr and Ellen Francis PARIS / BERLIN (Reuters) – Germany will present a multi-million dollar proposal to Lebanese authorities next week to rebuild the port of Beirut as part of efforts to entice the country’s politicians to form a government . able to avoid financial collapse, two sources said. A chemical explosion in the port last August killed 200 people, injured thousands and destroyed entire neighborhoods in the Lebanese capital, plunging the country into its worst political and economic crisis since the 1975-1990 civil war. According to two diplomatic sources with knowledge of the plans, Germany and France compete to lead the reconstruction efforts. Berlin will outline on April 7 a proposal that the European Investment Bank agreed to to help finance that would clear the area and rebuild the facilities, they said. One of the sources estimated the EIB financing in the range of € 2 billion to € 3 billion. A senior Lebanese official confirmed that Germany should submit a comprehensive proposal to rebuild the port. Neither the German Foreign Ministry nor the consulting firm Roland Berger, which according to diplomatic sources drew up the plan, immediately responded to requests for comment. The EIB was not immediately available for comment. The two diplomatic sources said that Lebanon’s political elite must first agree on the composition of a new government to fix public finances and root out corruption, a condition that donors, including the International Monetary Fund, are also insisting on before unlocking. thousands of millions. dollars in aid. “This plan is not going to come without conditions,” said one of the sources. “Germany and France first want to see a government committed to implementing reforms. There is no other way around it and this is good for Lebanon.” Eight months after the port disaster, many Lebanese who lost family, homes and businesses are still awaiting the results of an investigation into the causes of the explosion. Lebanon is on the brink of collapse, with buyers fighting for goods, protesters blocking roads and businesses closed. Foreign donors have said the new government must have a strong mandate to implement economic reforms, including a central bank audit and a review of the wasteful energy sector. However, Prime Minister-designate Saad al-Hariri and President Michel Aoun have been unable to agree on a ministerial alignment. The outgoing cabinet, which was removed after the blast, has remained in a caretaker capacity. The IMF has said there have been no discussions about the program with Lebanese officials, only technical assistance with the Finance Ministry and some state-owned companies. GERMANY’S PROPOSAL In addition to the port itself, Germany’s proposal would seek to rebuild more than 100 hectares in the surrounding area in a project that, according to the two diplomatic sources, would be in line with the post-war reconstruction of downtown Beirut. As in that reshuffle, the plan would involve the creation of a publicly traded company similar to Solidere, which was established by former Prime Minister Rafik Hariri in the 1990s and remains on the Lebanese stock exchange. Sources estimated the cost of the project at between $ 5 billion and $ 15 billion, and said it could create up to 50,000 jobs. The Lebanese official said that France and French ports and container shipping group CMA CGM were also interested in the reconstruction project. One of the diplomatic sources noted that France had sent several missions, including one in March that included CMA CGM, which showed interest in participating in the reconstruction. However, that mission focused on specific cleanup operations rather than broader redevelopment, the source said. The French Foreign Ministry declined to comment immediately. CMA CGM declined to comment. The Lebanese official placed the responsibility of launching the project on the Europeans by agreeing on who would be the leader. “This is a European decision at the end of the day, because they have to decide among themselves. Then when it comes down to it, the Lebanese government can move on,” the official said. Diplomatic sources said that Germany wanted to work closely with France on the issue, but that Paris was pursuing its own initiatives for now. “The irony of all this is that on the one hand the Europeans are talking about putting pressure on the political class while on the other they are fighting each other over these potential contracts when the vultures are still circling,” said one.