Many headlines, domestic and global, have already been written about whether the international community will accept a Lebanese government formed by Hassan Diab. All this talk of states and supranational bodies is very well, but one particular international community that needs to be convinced by the prime minister-designate’s Cabinet - if he is even able to form one - has been largely ignored: that of the Lebanese diaspora.
It is a well-known fact that Lebanese expatriates send billions of dollars in remittances back home every year. According to the Institute of International Finance’s Garbis Iranian, this figure peaked in 2014 at $9.6 billion before dropping to $7.7 billion in 2018. As confidence in the economy drops further, he expects remittances will fall to $6.5 billion next year.
While a significant number of Lebanese residents obsess over specific ministerial appointments, expats tend not to have such strong opinions on the minor details of government.
They want to see real action. Otherwise, they have no reason to believe that their relatives will be able to access the cash they send to them. For now, Lebanese banks are allowing clients to withdraw the full amount of remittances sent from outside of the country, but how long this will continue is anyone’s guess.
Then you have the many Lebanese businessmen and women working outside of the country who have been seduced by high interest rates into depositing their cash with the nation’s banks.
After a grinding economic crisis and the introduction by individual institutions of strict capital controls, the confidence of such investors that their money is safe in Lebanon will take a long time to regain.
Some politicians publicly called on the diaspora to keep sending small amounts of money back home, but even that may not be feasible in the current situation.
So as the political elite looks to appease the rest of the world, it may be worth focusing just as much effort on Lebanese citizens living overseas.
Chief among the many reasons a large number of these expats have no plans to return to Lebanon is the fact that the machinery of the state is broken. Despite being deeply frustrated by the corruption and mismanagement they see during their few weeks home every year, these people have continued to both spend and send money back here.
Now, they have fewer reasons to do so. If they stop, one of the only forms of foreign investment still flowing into Lebanon could dry up.