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Cablegate: Lebanon: Reconstruction Lags in the South

VZCZCXRO2736
PP RUEHBC RUEHDE RUEHKUK RUEHROV
DE RUEHLB #1828/01 3251620
ZNR UUUUU ZZH
P 211620Z NOV 07
FM AMEMBASSY BEIRUT
TO RUEHEE/ARAB LEAGUE COLLECTIVE PRIORITY
RUEHBS/USEU BRUSSELS PRIORITY
RHEHNSC/WHITE HOUSE WASHDC PRIORITY
RUCNDT/USMISSION USUN NEW YORK PRIORITY 1704
RUEHC/SECSTATE WASHDC PRIORITY 0268
RHEHNSC/NSC WASHDC PRIORITY

UNCLAS SECTION 01 OF 02 BEIRUT 001828

SIPDIS

SIPDIS

NSC FOR ABRAMS/SINGH/GAVITO/YERGER

E.O. 12958: N/A
TAGS: ECON PGOV PREL UNDP LE
SUBJECT: LEBANON: RECONSTRUCTION LAGS IN THE SOUTH

SUMMARY
-------

1. (SBU) Alaa Abu Hommeen of the Lebanon Transparency
Association (LTA) said in a November 13 meeting with PolOff
that while reconstruction efforts in the south are visible,
they are continuing to move at a slow rate due to corruption
and a lack of transparency. Hommeen said that the primary
obstacles have been problems between the GOL and the Council
of the South (COS), as well as a lack of progress in
reconstruction by Hizballah's Jihad al-Bina (JAB). End
Summary.

RECONSTURCTION SLOW DUE TO CORRUPTION
-------------------------------------

2. (SBU) Hommeen, the Program Manager of a new project titled
"Promoting Democracy in the South" (a Middle East Partnership
Initiative-supported program promoting democracy in southern
Lebanon), noted that one major roadblock to reconstruction
has been the on-going problem with the COS (Note: The COS is
an organization created by the government which is supposed
to be an independent agency, but, in reality, is controlled
and managed by Speaker of Parliament Nabih Berri, a political
ally of Hizballah . End Note.) Hommeen reported that in the
immediate months after the 2006 war with Israel, the GOL
directed money to the COS in order to start the rebuilding
process as quickly as possible. According to Hommeen, the
COS has been accused of corruption by a number of GOL
officials.

3. (SBU) According to Hommeen, the GOL alloted a large amount
of its reconstruction budget to the COS. Hommeen added that
the GOL authorized the COS to reimburse people, who were
either injured or had their homes damaged during the 2006
war, with cash payments. Hommeen said that if a person
claimed to have been injured, he or she was only required to
produce two doctors' signatures on a document with an
official seal from the "mukhtar", or mayor (which, according
to Hommeen is very easy to acquire) certifying that the
person resides in the area and/or was injured by the war.
However, Hommeen noted that many people approached the COS
with false claims. Hommeen mentioned one particular case
where a man was paid LBP 6 million (USD 4 thousand) for a
missing eye, when in fact both eyes were present and
accounted for.

4. (SBU) Hommeen said that a number of investigations began
due to the high number of false claims being filed. Hommeen
noted that there are more than twenty seven fraud cases that
have resulted from these allegations. Hommeen added that
since the scandals have broken out, the GOL no longer gives
money to the COS to reimburse victims. Instead, according to
Hommeen, the GOL gives this money to the Central Bank of
Lebanon (CBL). Hommeen said that people now have to apply
directly to the Ministry of Interior, which forwards their
claims to a privately contracted company which then conducts
an investigation of the person,s property and/or person.
The company either certifies or rejects the persons claim
and, if certified, the applicant can go directly to the CBL
to receive his or her check and bypass the COS all together.

5. (SBU) Hommeen added that the COS continues to receive
money from the GOL in order to pay its staff salaries and
overhead costs. Hommeen noted that Berri was unaware of the
large amounts of fraud being perpetrated and that Berri was
reportedly very upset saying that such people should "burn in
hell." However, Hommeen said that the COS cannot be audited
by any other GOL agency, given its official independent
status. Therefore, the COS can keep its books closed for the
foreseeable future.

HIZBALLAH LOSING SOME SUPPORT IN THE SOUTH, BUT NOT PUBLICLY
--------------------------------------------- ---------------

6. (SBU) Hommeen also noted that Hizballah,s "Jihad al-Bina"
(JAB) company, which has completed a number of rebuilding
projects in the area, has also encountered problems. Hommeen
said that in the immediate days after the war, Hizballah
handed out cash donations to the displaced and injured.
Hommeen added that the money that people originally received
is dwindling and now, especially with winter setting in,
people are beginning to question why reconstruction efforts
are moving so slowly. One example that Hommeen cited was
that of Dahiyeh, where Hizballah SYG Hassan Nasrallah
promised residents that the town would be re-built in less
than six months. According to Hommeen, "fifteen months

BEIRUT 00001828 002 OF 002


later, not much has been rebuilt." Hommeen alleged that most
of the money Hizballah received for reconstruction purposes
was pocketed for other purposes, and this is why
reconstruction in these areas has not met expectations.

7. (SBU) Hommeen believes that people in the south want to
speak out against Hizballah because of the lack of progress
on reconstruction and development. Since the war, Hommeen
added that most residents realize that, due to the current
political situation any such actions would make Hizballah
appear weak and ineffective, something that most residents
are afraid to do. Hommeen said that southern residents are
reluctant to provide Hizballah,s enemies any ammunition to
use against their patron and that they also do not want to
appear unsupportive or unappreciative of powerful Hizballah.

ADDITIONAL RECONSTRUCTION PROJECTS IN THE SOUTH
--------------------------------------------- --

8. (SBU) Hommeen noted that the French, Italians, and
Russians are repairing bridges in the south (Note: Whereas
other countries hired private contractors to do the
rebuilding, the Russian Army actually did the building of a
certain bridge, which Hommeen reports as looking very shoddy
and unsafe. End Note) Hommeen added that the EU and UNDP are
funding a number of agriculture and infrastructure projects
in the south, along with USAID. The Iranians have stuck to
rebuilding roads as their reconstruction assistance
contribution.

9. (SBU) Hommeen reported that the Qataris and Emiratis had
decided to adopt one or two villages to completely re-build.
Hommeen said the Qataris had begun rebuilding the villages of
Bint Jbeil and Khiam. However, due to corruption and money
laundering problems, the Qataris, who were at first opposed
to giving money directly to the Siniora government, have
decided that it would be more transparent to give the funds
directly to the GOL and let it handle the reconstruction.
Hommeen added, as a result of all these problems the Qataris
faced, the Emiratis and Saudis have decided to give money in
form of Paris III aid to the GOL.

HOMMEEN'S WISH LIST FOR THE USG
-------------------------------

10. (SBU) Hommeen believes that the USG could help by
directing assistance towards developing public buildings,
primarily public libraries. Hommeen argued that there are no
public libraries anywhere in the south and that if the USG
were to decide to invest in any new projects in the area,
"libraries would benefit the public more than anything else
because they provided citizens a place to meet, to conduct
research, enhance levels of education and decrease illiteracy
rates." Hommeen also argued that medical waste and waste
water treatment assistance is badly needed.

COMMENT
-------

11. (SBU) Contacts of the embassy in the government
contradicted Hommeen's claims, saying instead that the
residents living in south Lebanon continue to have to go
directly to the COS in order to receive compensation for
their injuries. It appears that, whether or not this is the
case, a large amount of reconstruction aid is being funneled
through the COS to the benefit of Speaker Nabih Berri, an
arch-enemy of the current government that the USG supports.
End Comment.
FELTMAN

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