Helping Jordan, Lebanon foot the bill for Syrian refugees

By hosting tragically high numbers of refugees fleeing the Syrian conflict, Lebanon and Jordan are providing a global public good to the international community.

They are offering the world, in a seamless and impressively generous way, a service that any other country has seldom offered: hosting millions of citizens from another country, suffering the stress that puts on their economies and stretching the limits tolerance in their societies, and adding to the already daunting security issues their countries face.

Just imagine if these two countries had chosen to shut their borders and leave millions of people crushed between an unforgiving conflict and a closed horizon.

The conflict in Syria has created significant development challenges for neighbouring countries, not least because of the large movements of population seeking refuge from brutal violence.

One could identify three phases in the international community’s approach to, and attempts to deal with, the impact of the Syrian crisis on the country itself, and broadly on the Mashreq region.

First of all, the world looked at the Syrian civil war and its impact on neighbouring countries as a humanitarian issue, characterised by large but still controllable flows of refugees.

The UN system, in particular UNHCR, and bilateral donors engaged fast with the Lebanese and Jordanian governments in addressing this initial challenge. Camps were set up, mainly in Jordan and informal settlements were tolerated in Lebanon.

Then, the flows of refugees to these two countries shot up and started posing a security, humanitarian and developmental challenge to their hosts.

The international community began talking about the humanitarian-development nexus, or continuum. Instruments were put in place, such as the UN regional rapid-response plans, stabilisation plans and roadmaps.

On the financing side, the World Bank-managed multi-donor trust fund for Lebanon, as well as emergency operations for Jordan and other financing mechanisms, were created to signal the willingness of the international community to help both Lebanon and Jordan tackle this exogenous shock that started to threaten their own development and reverse some of their achievements in health, education, water and sanitation.

This was aside from the infrastructural challenges.

While camps were hosting the vast majority of refugees, a large number of them were in fact living outside, mingling with the local population and entering the host country’s labour markets.

In some parts of Jordan, an interestingly positive economic dynamic was created by the inflows of new consumers and micro-business owners.

This was in addition to the cheap labour these populations offered in both Lebanon and Jordan.

The World Bank published a landmark report, Lebanon: Economic and Social Impact Assessment of the Syrian Crisis, in late 2013 that stressed all these factors and offered a reality check and an underpinning for Lebanon’s call to the international community for help.

Now, and thirdly, the situation in the field has further evolved, and in a dramatic way.

It now appears there is no end in sight to the Syrian conflict and no predictable time frame for the refugees to return to Syria.

The host countries are starting to realise that this is a new fact, a new certainty that needs to be included in their plans.

The host countries now find themselves responsible for both their own citizens and the millions of Syrian refugees now living alongside them. 

These countries and the world are looking at a brutal demographic shift, an acceleration that took Lebanon from a population of 4.2 million to about 5.5 million in the span of less than four years.

The same, with a slightly varying magnitude, is true for Jordan.

It is this new situation that needs to be addressed through new ways and new instruments.

We are not talking any longer about humanitarian actions or development engagement. 

We are looking at a new reality, one in which countries like Jordan and Lebanon are forced to cope with the economic and social challenge of an unforeseen demographic acceleration that can cause immense damage to their insufficient, but still real, development gains of the last 30 years, and provoke an unsustainable economic, social and security shift.

For Lebanon, because of the particular social equilibrium of the country, this stress could constitute an existential threat.

Implementing a development-led approach to mitigate the impact of the Syrian conflict has fallen short of needs given the limited financial support to host countries’ budgets.

As the Syrian conflict enters its fifth year, there is a strong understanding that this impact has to be addressed through development-led approaches, but the financing of these approaches has not been commensurate to the large needs, especially for Lebanon.

Humanitarian and development partners, including donors, have provided significantly more support for extra-budgetary spending for host countries.

This certainly alleviates some of the development impacts on both host and refugee communities. It does not, however, directly help relieve the countries’ budgetary cost.

Furthermore, by understandably being skewed towards refugees, this support does not offset impacts on the hosts and tends to be in the form of short-term interventions not synchronised with, and possibly distorting, the economic (and spatial) development strategies of the host country.

Thus, the primary concern of host countries, the large and direct fiscal burden incurred by hosting a large refugee population, is not addressed. And this concern is especially acute given the high debt burdens that Lebanon and Jordan already have.

Four years after the start of the conflict, it has become clear that the financing needs that host countries require to address these challenges are not forthcoming in the terms and magnitude that were initially envisaged: grant funding has been and will likely remain limited to a fraction of what is required, while traditional development funding is available at the needed scale but is non-concessional for Syria’s middle-income neighbours.

There is an imperative, today, for all of us — members of the international community of nations as well as the multilateral donors — to seek and find creative ways of helping Lebanon and Jordan manage and absorb the economic and social stress caused by this unprecedented crisis.

If we fail, the cost will be tremendous and rather than helping them pay for the global public good they are providing us with, the international community will have to settle the bill for the global public bad that would be created by neglecting Jordan and Lebanon.

The writer, based in Beirut, has been the World Bank director for the Middle East since September 2012. He contributed this article to The Jordan Times.