SAADNAYEL, Lebanon: For humanitarian reasons, Lebanese authorities have long ignored a flood of unlicensed small shops and businesses opened by Syrian refugees trying to eke out a living in the face of limited assistance from U.N. agencies and the government. Many do not have proper documentation, and the trend has prompted some Lebanese business owners to complain of unfair competition.
And as Lebanon grapples with the economic and social fallout of receiving over a million Syrian refugees fleeing a conflict that is now in its third year and has no end in sight, it was inevitable that something would have to change.
This week, municipal authorities and the Internal Security Forces begin enforcing laws that require local businesses to have proper documentation and comply with national standards.
But there is mounting concern among Syrian refugees that a fresh crackdown on illegal businesses could destroy the livelihood of many already struggling with poverty.
The dilemma is particularly acute in areas that support the rebels battling President Bashar Assad’s regime, many of which have absorbed large numbers of refugees beyond their capacity. This is especially true in central and Western Bekaa, where preliminary official statistics indicate that Syrian refugees own more than 360 shops and businesses.
The actual numbers are likely much higher, however. In Saadnayel, a small town in central Bekaa Valley, there are over 60 Syrian shops, according to the latest municipality survey.
Syrian Abu Mohammad fled Idlib a year ago. He now owns a clothes shop in Saadnayel’s center.
He set it up after realizing he needed a second income. He says the financial assistance he receives through the U.N. High Commissioner for Refugees – which amounts to LL47,000 per month per person – is not enough to provide for his family for more than a week.
The shop brings in revenues of $300-$400 a month, barely enough to pay the rent for his home, which hosts 21 family members.
Abu Mohammad pays rent for his shop, but does not pay any taxes to the Lebanese state. He says he was not aware of the need for a permit and has not been asked to get proper paperwork by any state authority. He says he is ready to meet any requirements necessary under Lebanese law.
“As a refugee I am under the law and respect the rules of the country that protects and hosts me,” he said.
The vast majority of ventures by Syrian refugees are small businesses, such as car repair shops, eateries, clothes shops and tailors.
Abu Shadi, a refugee from Daraya, a town in the Damascus countryside, fled to Lebanon eight months ago. At his shop, he sews and alters clothes, particularly the “dishdasha” (thawb) favored by Syrian refugees, which sells for LL10,000 apiece. He has a family of eight.
He echoes many of the complaints made by other refugees about the miniscule handout from UNHCR and the high rents in Saadnayel, where an apartment costs nearly as much as those in the capital.
Abu Shadi says the man he rents the shop space from told him he did not need a permit, but adds he does not want to do anything against the law in Lebanon or that might cause the closure of any Lebanese business.
All he wants, he says, is to feed his family and return to his hometown as soon as possible.
Khalil Chehimi, the head of Saadnayel municipality, says the opening of businesses in Lebanon by Syrian refugees poses “great danger” to the Lebanese economy.
He says many Lebanese are facing competition as the number of refugee businesses increases, bolstered by the authorities ignoring legal violations. This has led to loss of capital for Lebanese businesses and could drive many to leave the country if the refugee crisis takes too long to resolve, he adds.
Chehimi says the local municipalities have to take a leading role in regulating businesses and enforcing the law, while keeping in mind the needs of local communities.
In Saadnayel alone, he says, there are 22,000 refugees and 60 refugee-owned businesses – a quarter of the town’s total.
He says the vast majority of the businesses were registered under Lebanese names in an attempt to circumvent the law, and claims owners often submit fictitious receipts showing no profit in order to avoid paying taxes.
Some Syrian refugee business owners, however, have tried to go through the official route.
Seven months ago, Abu Ahmad Halabi set up a restaurant in the Zahle town of Barr Elias. The cost of opening the eatery was $35,000. When he visited the municipality to ask about paperwork, he was told: “Go work; We don’t have any instructions on this issue.”
For the entire time his restaurant has been operational, Halabi has had regular visits from officials to review health standards. He says he decided to open a restaurant when he went to register as a refugee and saw what he calls the “humiliation” of the Syrians there.
Halabi argues that the presence of large numbers of refugees has created economic opportunities, since local businesses cannot by themselves provide for the needs of all the arrivals.
“We are not considered competition to the Lebanese in a lot of the new needs that have arisen in the local Lebanese market,” he said.
Halabi says he is ready to comply with Lebanese regulations, but points out that he has to pay rent and feed his family of 10 as well as the families of the four other refugees he employs at the restaurant.
“The idea that the U.N. is keeping the families alive is wrong,” says Halabi. “The issue is not just lentils and rice. What about the rent, clothes, drink, electricity. Everything is expensive here.”
Samir, a refugee from Deraa and a partner at a restaurant owned by a Lebanese, says Syrians aren’t causing losses for Lebanese businesses, but have merely exposed the high profit margins that some business owners were taking advantage of.
“Their employees are Syrian and they either own their shops or pay old rental rates. Our workers are also Syrian and our rents are twice their rents, and our expenses are the same,” he says. “So how are we making profits and they are losing?”
He says many larger Syrian businesses also have a questionable legal status since many employ Syrians whose paperwork was not settled and who receive assistance from UNHCR.