GOVERNMENT

Type: Republic.

Independence: November 22, 1943.

Constitution: May 23, 1926.

Branches: Executive--president (chief of state), prime minister (head of government), deputy prime minister, cabinet. Legislative--unicameral national assembly. Judicial--four Courts of Cassation, Constitutional Council, Supreme Council.

Administrative subdivisions: 8 governorates.

Political parties: Amal Movement, Ba'ath Party, Democratic Left, Democratic Renewal Movement, Free Patriotic Movement, Future Movement, Hezbollah, Kataeb Party, Kataeb Reform Movement, Lebanese Forces, National Bloc, Marada Movement, Nasserite Popular Movement, National Liberal Party, Popular Bloc, Progressive Socialist Party, Qornet Shehwan Gathering, Syrian Social National Party, Tachnaq Party.

A principal divide in current Lebanese politics is between pro-and anti-Syrian forces, often referred to, respectively, as March 8 and March 14, after major demonstrations they organized in 2005. "March 8" consists principally of the Shi'ite Amal and Hezbollah, now allied with the Free Patriotic Movement (Christian), while March 14 includes the Future Movement (Sunni), Progressive Socialist Party (Druze), and Lebanese Forces and Qornet Shehwan Gathering (both Christian).

Suffrage: 21; compulsory for all males; authorized for women at 21 with elementary education.

ECONOMY

GDP (2006 est.): $21.5 billion.

GDP growth rate (2006 est.): (-5%).

Per capita GDP (2006 est.): $5,500.

Natural resources: limestone, iron ore, salt. Agriculture: Products--citrus, grapes, tomatoes, apples, vegetables, potatoes, olives, tobacco; sheep, goats. Arable land--18%.
Industry: Types--banking, tourism, food processing, jewelry, cement, textiles, mineral and chemical products, wood and furniture products, oil refining, metal fabricating.
Trade: Exports--$1.88 billion (2005 est., f.o.b.): authentic jewelry, inorganic chemicals, miscellaneous consumer goods, fruit, tobacco, construction minerals, electric power machinery and switchgear, textile fibers, paper. Major markets--Syria, U.A.E., Switzerland, Turkey, Saudi Arabia. Imports--$9.34 billion (2005 est., f.o.b.): petroleum products, cars, medicinal products, clothing, meat and live animals, consumer goods, paper, textile fabrics, tobacco. Major suppliers--Italy, Syria, France, Germany, China, U.S., U.K., Saudi Arabia.

PEOPLE

The population of Lebanon comprises various Christian and Muslim sects as well as Druze. No official census has been taken since 1932, reflecting the political sensitivity in Lebanon over confessional (religious) balance. While there is no consensus over the confessional breakdown of the population for this reason, it is safe to say that the Muslim sects as a whole make up a majority, and that Shi'ites, Sunnis, and Maronites are the three largest groups.

About 400,000 Palestinian refugees, some in Lebanon since 1948, are registered with the United Nations Relief and Works Agency (UNRWA). They are not accorded the legal rights enjoyed by the rest of the population.

With no official figures available, it is estimated that 600,000-900,000 persons fled the country during the initial years of civil war (1975-76). Although some returned, continuing conflict through 1990 as well as after the 2006 war sparked further waves of emigration, casting even more doubt on population figures. As much as 7% of the population was killed during the civil war between 1975 and 1990. Approximately 17,000-20,000 people are still "missing" or unaccounted for from the civil war period.

Many Lebanese still derive their living from agriculture. The urban population, concentrated mainly in Beirut and Mount Lebanon, is noted for its commercial enterprise. A century and a half of migration and return have produced Lebanese commercial networks around the globe--from North and South America to Europe, the Gulf, and Africa. Lebanon has a high proportion of skilled labor compared with many other Arab countries.

HISTORY

Lebanon is the historic home of the Phoenicians, Semitic traders whose maritime culture flourished there for more than 2,000 years (c.2700-450 B.C.). In later centuries, Lebanon's mountains were a refuge for Christians, and Crusaders established several strongholds there. Following the collapse of the Ottoman Empire after World War I, the League of Nations mandated the five provinces that comprise present-day Lebanon to France. Modern Lebanon's constitution, drawn up in 1926, specified a balance of political power among the various religious groups. The country gained independence in 1943, and French troops withdrew in 1946. Lebanon participated in the 1948 Arab-Israeli War and signed an armistice with Israel on March 23, 1949.

Lebanon's history since independence has been marked by periods of political turmoil interspersed with prosperity built on Beirut's position as a regional center for finance and trade. In 1958, during the last months of President Camille Chamoun's term, an insurrection broke out, and U.S. forces were briefly dispatched to Lebanon in response to an appeal by the government. During the 1960s, Lebanon enjoyed a period of relative calm and Beirut-focused tourism and banking sector-driven prosperity. Other areas of the country, however, notably the South, North, and Bekaa Valley, remained poor in comparison.

In the early 1970's, difficulties arose over the presence of Palestinian refugees, many of whom arrived after the 1967 Arab-Israeli war, the secret 1969 Cairo Agreement permitting the establishment of Palestinian camps in Lebanon, and 1970 "Black September" hostilities in Jordan. Among the 1970 arrivals were Yasser Arafat and the Palestinian Liberation Organization (PLO). Coupled with the Palestinian problem, Muslim and Christian differences grew more intense.

GOVERNMENT

Lebanon is a parliamentary democracy in which the people constitutionally have the right to change their government. However, from the mid-1970s until the parliamentary elections in 1992, civil war precluded the effective exercise of political rights. According to the constitution, direct elections must be held for the parliament every 4 years. Parliament, in turn, is tasked to elect a new president every 6 years. A presidential election scheduled for the autumn of 2004 was pre-empted by a parliamentary vote to extend the sitting president's term in office by 3 years. An election for a new president was held in May 2008 with the next election scheduled for 2014. Parliamentary elections were held on June 7, 2009. The president, based on binding consultations with the parliament, appoints the prime minister. While political parties are legal and may be formed, most that exist are based on sectarian interests.

Since the emergence of the post-1943 state, national policy has been determined largely by a relatively restricted group of traditional regional and sectarian leaders. The 1943 national pact, an unwritten agreement that established the political foundations of modern Lebanon, allocated political power on an essentially confessional system based on the 1932 census. Until 1990, seats in parliament were divided on a six-to-five ratio of Christians to Muslims (with Druze counted as Muslims). With the Taif Agreement, the ratio changed to half and half. Senior positions in the government bureaucracy are allocated on a similar basis. Gaining political office is virtually impossible without the firm backing of a particular religious or confessional group. The pact also allocated public offices along religious lines, with the top three positions in the ruling "troika" distributed as follows:

·        The presidency is reserved for a Maronite Christian;

·        The prime minister is reserved for a Sunni Muslim, and

·        The speaker of parliament is reserved for a Shia Muslim.

Efforts to alter or abolish the confessional system of allocating power have been at the center of Lebanese politics for decades. Those religious groups most favored by the 1943 formula sought to preserve it, while those who saw themselves at a disadvantage sought either to modify its demographic formula or to abolish it entirely. Nonetheless, many of the provisions of the national pact were codified in the 1989 Taif Agreement, perpetuating sectarianism as a key element of Lebanese political life. In the spring of 2011, capitalizing on the "Arab Spring" of popular uprisings throughout the region, several groups called for the "de-confessionalization" of Lebanon and an end to sectarian quotas. The groups could not agree, however, on what would replace the system and their movement lost momentum.

Although moderated somewhat under Taif, constitutionally, the president has a strong and influential position. The president has the authority to promulgate laws passed by the Chamber of Deputies, to issue supplementary regulations to ensure the execution of laws, and to negotiate and ratify treaties.

The Chamber of Deputies is elected by adult suffrage (majority age is 21) based on a system of proportional representation for the various confessional groups. Political blocs are usually based on confessional and local interests or on personal/family allegiance rather than on left/right policy orientations.

The parliament traditionally has played a significant role in financial affairs, since it has the responsibility for levying taxes and passing the budget. It also exercises political control over the cabinet through formal questioning of ministers on policy issues and by requesting a confidence debate.

Lebanon's judicial system is based on the Napoleonic Code. Juries are not used in trials. The Lebanese court system has three levels--courts of first instance, courts of appeal, and the court of cassation. There also is a system of religious courts having jurisdiction over personal status matters, such as marriage, divorce, and inheritance, within particular religious communities.

 

PRINCIPAL GOVERNMENT OFFICIALS

Ø  President--Michel Sleiman

Ø  Prime Minister--Najib Mikati

Ø  Speaker of Parliament--Nabih Berri

Ø  Minister of Foreign Affairs--Adnan Mansour

Ø  Finance Minister--Mohammad Safadi

Ø  Defense Minister--Fayez Ghosn

Ø  Interior Minister--Marwan Charbel

ECONOMY

Lebanon has a free-market economy and a strong laissez-faire commercial tradition. The Lebanese economy is service-oriented; main growth sectors include banking and tourism. According to the Central Bank of Lebanon, Lebanon posted 7.5% GDP real growth in 2010, with inflation running at 4.5%. There are no restrictions on foreign exchange or capital movement, and bank secrecy is strictly enforced. Lebanon has legislation to combat money laundering and terrorism finance, and joined the Kimberley Process in September 2005. There are practically no restrictions on foreign investment; however, the investment climate suffers from red tape, corruption, arbitrary licensing decisions, high taxes, tariffs, and fees, archaic legislation, and a lack of adequate protection of intellectual property. There are no country-specific U.S. trade sanctions against Lebanon.

Lebanon embarked on a massive reconstruction program in 1992 to rebuild the country's physical and social infrastructure devastated by both the long civil war (1975-90) and the Israeli occupation of the south (1978-2000). In addition, the delicate social balance and the near-dissolution of central government institutions during the civil war handicapped the state as it sought to capture revenues to fund the recovery effort. Monetary stabilization coupled with high interest rate policies aggravated the debt service burden, leading to a substantial rise in budget deficits. Thus, the government accumulated significant debt, which by the end of 2010 had reached $52.6 billion, or 135% of GDP. Unemployment was estimated at 9.2% in 2007 by the Central Administration of Statistics, according to latest published data.

The government has maintained a firm commitment to the Lebanese pound, which has been pegged to the dollar since September 1999. The government passed an Investment Development Law as well as laws for the privatization of the telecom and the electricity sector, signed the Euro-Med Partnership Agreement with the European Union (EU) in March 2003 and the Association Agreement in 2006, and is working toward accession to the World Trade Organization (WTO). In order to increase revenues, the government introduced a 10% value added tax (VAT) that became applicable in February 2002 and a 5% tax on interest income that became applicable in February 2003. The Finance Ministry submitted additional revenue-raising measures as part of the 2009 budget.