As part of the United Nations Sustainable Development Goals (SDG’s). Goal 8 is focused on “Promoting sustained, inclusive and sustainable economic growth, full and productive employment and decent work for all”. In the city of Beirut, a group of us within the Lebanese ministry of tourism were teamed up with a group of people from the UN development program, and we were tasked to focus on SDG Goal 8.
We were thinking about a pressing challenge in the situation we are in now: if Lebanon is perceived as a tourist destination. Potential tourists/visitors to Lebanon always have something stopping them from visiting Lebanon, especially those who do not know much about it and have not visited it before.
These perceptions were highly influenced by the way the media portrays Lebanon with all its economic and political instabilities. We questioned what we could do to change this narrative, and how could we shift people’s perceptions of what Lebanon is to influence them to travel to this country full of rich culture and breathtaking landscapes.
The graph above shows the change in Lebanon’s GDP over the years, indicating a sudden fall after 2019. In the economic situation which we are currently in, Lebanon needs something to help revitalize this situation and help it grow again. For that reason, we launched a program to revitalize the Lebanese economy through tourism enhancement.
We analyzed several sources of data and came up with the visualization under. The visualization indicates there is a direct correlation between Lebanon’s GDP and tourism receipts. Up till 2018 and 2019 (shaded 1), we see Lebanon’s GDP and tourism receipts both at their highest points. After those years, we see a sudden drop in 2020 in both indicators (shaded 2).
For this reason, we did the following:
We invited travel bloggers, and social media influencers from around the world and we specifically targeted those with a large amount of following and influence. The goal of this was not to bring them so that they could showcase Lebanon to their following base. The goal behind this was to immerse them in the Lebanese culture and the activities and experiences they will cherish from being in Lebanon. That way, what they share with their audience is authentic, and true to the emotions they felt.
We also targeted other areas of improvement which were important for the success of the project. Those are regarding: infrastructure, marketing, and local community involvement. We coordinated with municipalities, as well as local businesses to ensure that all our key points are addressed to enhance the tourist experience in our country. We think that our concentrated efforts to enhance the tourism experience and actively include local communities are what will be responsible for revitalizing the Lebanese economy in the right direction again. In addition to stimulating the travel and tourism industry, our project will potentially have a positive knock-on effect on the whole economy, generating jobs and encouraging sustainable growth.
Wages and salaried workers is a crucial topic that has been discussed world wide and addressed in different ways. Several factors affect the total number of salaried workers in a country including the available job opportunities, the demand and supply enforced on labor force, and the type of field a worker is in. As such, this has created huge gaps and inequality in wages and salaried workers all over the world.
To better understand this feature, the below graph displays the changes of wage and salaried workers percentage over the years from 1991 to 2019 in the MENA region.
Looking at the graph, we can see that Qatar, Bahrain, UAE, Saudi Arabia, and Oman are countries that remained to be the top in terms of wage and salaried workers throughout the years as compared to other countries in the MENA region such as Lebanon, Syria, Yemen, and others. These top 5 countries all recorded over 95% of the workers are salaried and waged overr the years.
Moreover, looking more closely at other countries, we can see that countries such as Lebanon has a maximum of 65% of workers who are salaried workers and Libya with the lowest value among all countries.
This shows that among the countries in the MENA region there exists huge gaps and inequalities between workers in countries mainly due to scarce job opportunities in middle and low income countries such as Lebanon. This huge difference has caused a large number of fresh graduates in Lebanon to seek jobs outside of their country and mainly towards UAE and Saudi Arabia.
Wassim, Nathalie, and Imad; three individuals who were pushed out of work by the deteriorating economic conditions in Lebanon. Tens of thousands of people like them have been suffering daily for the past 3 years living from paycheck to paycheck up until they were forced out of it (work). Lebanon has witnessed what no other country has. Unemployment rates doubled in only a decade, COVID-19 took out thousands, and inflation bankrupted hundreds of businesses.
According to Okun, a very low or negative growth in GDP leads to a rise in unemployment. By observing this visual, we can see how unemployment skyrocketed while GDP growth took a deep dive. Comparing the years 2008 and 2009, GDP growth increased 10.23 percentage points while unemployment rates decreased by 6.35 percentage points. We can conclude an inverse correlation between GDP growth and unemployment. Another observation is that between years 2020 and 2021, GDP growth increased by almost 15 percentage points. Despite this growth, unemployment remains significantly high at 14.49 percentage points. Importantly, this project is action-oriented in that it shows the nexus between unemployment and GDP growth #SDG8, which are intrinsic to an economy, from more “policy-driven” factors that can be addressed, improved or mitigated.
Here, a question rises? What is the cause for the disproportionality between GDP growth and unemployment rates? There are 3 possible causes for its inverse relation:
• The decrease of Foreign Direct Investment (FDI) which reached 3.98 percentage points in 2019 due to the lack of security and political tension
• Another possible cause is the low diversification in economic sectors due to scarcity of resources. Looking at this visual, we can see the focus of employment shift mainly to the service industry which witnessed an increase by 65.10 percentage points while the agricultural and industrial sectors are left behind increasing by under 30 percentage points in 2019.
• The third and final possible cause is the over-dependence on food and fuel imports. Lebanon possesses the second highest food and energy imports in 2019.
What should be done?
Drawing upon decades of empirical literature on drivers and predictors of lack of growth, this project proves Okun’s law using visualizations for the case of Lebanon. According to International Labor Organization (ILO), not just growth, but quality of growth is the key anchor in the SDGs 2030 agenda. Sustainable economic growth will require societies to create the conditions that allow people to have quality jobs that stimulate the economy while not harming the environment.
1. Creating greater opportunities for women and men to secure decent employment and income. Closing the employment gap is at the heart of the decent work agenda, this can be through promoting voluntary private initiatives and corporate social responsibility.
2. Instating policies to enhance knowledge, skills and employability for men and women since gender remains a source of labor market inequalities and inadequately utilized human resources. Women continue to be employed in a narrower range of occupations than men and to be concentrated in lower-paid, insecure, and unprotected jobs.
3. Promoting employment through reconstruction and employment-intensive investment.
4. Increasing access to financial services to manage incomes, accumulate assets and make productive investments.
Findings and Recommendations
A shift in economic thinking and planning towards economic structural transformation is necessary for the Arab region to develop on SDG 8 (ESCWA, 2021). The post-pandemic SDG agenda must leverage the lessons learnt to reinforce national social safety nets and employment policies. This strengthens economic resilience and allows developing countries to absorb shocks. A continued lack of decent job opportunities, insufficient investments, and under-consumption slows down economic growth. The average growth rate GDP is increasing after the pandemic; however, it still did not reach pre-pandemic levels of growth and developing countries such as Lebanon are moving farther from the 7% growth rate set for 2030. Therefore, as labor productivity decreases driven by low productivity and unemployment rate rises, standards of living decreases and overall economic growth decreases.
Governments must join forces and formulate policies to promote better job opportunities through active labor market programs, corresponding to important SDGs: Economic Growth and Decent Work, as well as Partnerships to Achieve the Goals.
Sustainable economic growth will require societies to create the conditions that allow people to have quality jobs that stimulate the economy while not harming the environment. Job opportunities and decent working conditions are also required for the whole working age population. There needs to be increased access to financial services to manage incomes, accumulate assets and make productive investments. Increased commitments to trade, banking and agriculture infrastructure will also help increase productivity and reduce unemployment levels in the world’s most vulnerable regions.#SDG8 #SDG16
Lebanon has been historically exporting skilled workers to many regions in the world including Gulf, Africa, Europe, and North America. For more than 10 years, the Unemployment rate in Lebanon has been increasing to reach 11.35% in 2019 (from 6.35% in 2009). Since the Economic crisis in 2019, the rate has dramatically increased to reach 14.5% in 2021.
To dig deeper into unemployment in Lebanon we can see that the citizens with advanced education (holders of a university degree or above) are prone more to unemployment, in comparison to intermediate (secondary schooling) and basic education (primary schooling or below).
So what can we do to solve this?
It is worth mentioning that since the economic crisis in Lebanon in 2019 followed by the COVID-19 pandemic, the Lebanese economy deteriorated severely leading to the closure of many companies and establishments or downsizing in the terms of employees and costs.
Note that among the 3 sectors (services, industry, and agriculture), the services sector was the most to hold the burden of this economical crisis, especially for the restaurants, hotels, banks, and retail traders,…
The employment breakdown as per sector shows that the service sector retained the most employment over years, in contrast to agriculture which only received 11.32% of total employment in 2019.
Therefore, we should try to shift the load of the employment to the other sectors in Lebanon (industry and agriculture) by encouraging the highly educated persons to start their own businesses in this area, which will then lead to more employment from the less educated in these 2 fields.
This will not be attainable unless the government and international entities start incentivizing the youth by providing the below:
Access to finance (through long-term small loans at a minimized rate of interest)
Access to knowledge (by providing proper training to the youth in management and technical expertise)
Access to market (by providing the connections to the youth to sell their products through)
To note that some initiatives from the public have been launched to provide one or more of the above-mentioned, however, the government hasn’t yet started any steps to help.
The average CPI (Consumer Price Index) has drastically increased in 2021 mainly due to governments’ economic
policies shaped by the COVID-19 pandemic.
As we can see in the graphs below, the average government debt as % of GDP has increased from 61% in 2019 to 80%
in 2020. This suggests that these governments are taking loans from their central banks to counter the COVID-19
pandemic. As we can see, the average money supply growth has increased from 10% in 2019 to 18% in 2020. This jump is
explained by the central banks printing money to lend it to their governments. The increase in money supply has led
to global inflation which affects most countries’ citizens.
Governments should stop spending so much money on unemployment benefits since:
Keeping those benefits would encourage people to stay unemployed and collect a paycheck while contributing nothing to the economy of their country
The funds are directly used in consumer expenditure which is raising the CPI
Governments should instead adopt more long-term strategies that aim to increase production and help with the recession
