The foul odors of waste profiteering, corruption and the illegal grab of public funds are back in the public eye. Not that they ever disappeared, really. One year after the onset of Lebanon’s waste crisis, the ruling junta is still trying to push unsustainable and overly expensive waste management plans, which only benefit the ruling political parties and their cronies.The situation can be summarized by the following: Lebanon produces an estimated 5,000 tons of municipal solid waste each day. Until last year, one company, Sukleen (Averda), managed waste collection and treatment comprising about 50 percent of this total, specifically in the areas of Greater Beirut, Mount Lebanon and Kesrouan, covering about 400 municipalities. Sukleen, which has been operating since 1994 under a contract with the Council for Development and Reconstruction, has seen its contract renewed without an open tender by the Cabinet (in which most ruling parties are represented). This has occurred three times, and each time the collection and processing fees have increased, all paid using transfers from the Independent Municipal Fund. The operation started with 800 tons per day in 1994, and grew to 2,600 tons per day in 2015, all dumped with minimal sorting and recycling in the Naameh landfill, which had already reached its absorptive capacity 10 years ago. Sukleen’s revenues were estimated at more than $170 million per year (about $150/ton), one of the highest rates in the world. Many suspected that a sizeable chunk of these revenues were channeled through kickbacks to political leaders to ensure “smooth operations.”
With the closing of Naameh by protesters in early 2015, the government made a series of so-called waste management decisions, all coordinated by the CDR in collaboration with the Interior and Environment ministries. At the beginning of 2015, the government decided to divide the country into six regions (and therefore Sukleen’s “region” into three), and invited bids for waste management in each region. In April 2015, bidding was closed for the new plan, and unsurprisingly no bids were received for Beirut and Mount Lebanon. Only one bid per region was received for north Lebanon, the Bekaa and south Lebanon.
Following massive protests in the summer of 2015, the government canceled the bids and decided in November 2015 to export waste, again through plans managed by the CDR. The overly expensive and disastrous scheme faced opposition from a range of activists, especially when details about corruption and falsification of documents emerged by the retained company, Chinook. By early 2016, the export plan was dropped.
In March 2016, the Chehayeb Plan (named after Agriculture Minister Akram Chehayeb) was approved by the Cabinet. Briefly, the four-year plan reopened the call for bidding through the CDR for companies to manage waste in “Sukleen regions,” yet it also entailed the construction of two coastal landfills in Burj Hammoud (a northern Beirut suburb) and Costa Brava (a southern Beirut suburb, near the capital’s airport). The municipalities surrounding the new landfills received sizeable monetary incentives: $40 million each (municipalities of Burj Hammoud, Jdeideh-Boushrieh, Burj al-Barajneh, and Choueifat), $50 million for the three regions for developmental projects over four years, and the right for these municipalities to exploit the coastal landfilled areas. The regions of Aley and Chouf were excluded from the initial plan since no landfill was secured there (and trash has been piling up ever since in these regions). The CDR immediately began launching calls for tenders for all components of this new plan.
The Burj Hammoud landfill contract was awarded in June 2016 for $77 million and Costa Brava in July 2016 to the Jihad al-Arab company for $60 million (Jihad al-Arab was allowed to present a lower bid even after his first one was dismissed). On Sept. 2, 2016, a bid by Jihad al-Arab was also retained by the CDR for the sorting and treatment of waste in all “Sukleen regions,” at a cost of $81 million over four years. The collection and waste transport contract will remain with Sukleen until the bidding process is formally launched.
All in all, one year after the first street protests succeeded in countering the government’s corrupt plans, we now have a “Chehayeb Plan” that costs $528 million over four years, not counting the money wasted on short fixes in Naameh in 2016 (almost $10 million), and other funds spent on “consultants.” A simple calculation shows that the cost per ton of this corrupt plan is well over $130 million per year, which is about $170 per ton if one includes the collection and transport costs. This is $20 per ton more than what Lebanon used to pay for Sukleen. Additionally, one must consider the cost of environmental degradation to the coastline due to new landfills and the health and safety risks they create (most importantly on flights through the airport), among other factors.
The corrupt ruling class, by reverting back to a costly centralized waste management plan through the CDR, has continued its rent redistribution practices to secure allegiances among their cronies. What Sukleen was suspected of practicing under the table is now overtly implemented through the “Chehayeb Plan,” with hefty “compensation payments” and real estate gains for municipalities (and to the political parties controlling them). Similar to what happened in the electricity, water and other essential sectors, the ruling class continues to divide up the “cake,” while citizens and the next generations pay the highest price.
In light of widespread corruption and the lack of transparency, the role of oversight bodies (such as the largely absent Court of Accounts) and the Parliament has not been capitalized on in order to address the citizenry’s interests. It is particularly odd, and some would argue worrying, that MPs have not called for a session to question the government on how the trash crisis managed to reach this stage. For their part, political parties have also failed their constituents, as they have continually refused to work toward a solution which is both sustainable for the country as a whole and in the best interests of the people they represent.
The only solution to counter these schemes is the decentralization of waste management, where every municipality implements sorting at the source, and commits to waste reduction, recycling and treatment of organic waste into compost. This yields the lowest environmental and financial costs, and reduces the size of the “cake.” In parallel, the institutions of this ruling cartel should be at least bypassed, if not completely dismantled. A matter of particular importance is reforming the CDR to ensure there is an accountable procurement system in place.
Also, as part of the solution, Lebanon must take additional steps in conjunction with institutional decentralization by embracing a strong role for oversight agencies and the Parliament. Without these measures, the crisis will threaten to drag on, and in the event a “solution” is found without necessary oversight, the powers that be have demonstrated their preferred course of action will not be sustainable, apart from ensuring state money lands in the hands of Lebanon’s corrupt elite.
Jad Chaaban is an associate professor of economics at the American University of Beirut, the co-founder of the Lebanese Economic Association and an LCPS research fellow.