Lebanon News

Lockdown ravages nightclubs hit by dollar crisis

(Photo courtesy of The Ballroom Blitz)

BEIRUT: As Lebanon continues its phased lockdown exit, fears of a second wave naturally emerge. This week's discovery of a virus cluster among foreign workers unable to practice social distancing put pay to those fears. Crowded in and a place to mingle, nightclubs and social distancing could not be more incompatible, and their return could be seen as inappropriate for a long time yet.

Yet coronavirus is only part of nightclubs' problems in Lebanon. The currency crisis, not to mention inflation in general, has destroyed purchasing power and created unworkable conditions for businesses heavily reliant on imported goods.

''It is impossible to sell alcohol unless you are willing to boost your prices ridiculously,'' Ballroom Blitz founder Joe Mourani explained to The Daily Star. ''A bottle from suppliers used to cost $10 but now is $30. To mark up selling price you’re tripling prices which is absolutely not an option,'' he continued. Ballroom Blitz is not alone. ''As long as the peg remains at LL1,500, it is financially impossible to operate,'' Nemer Saliba, co-owner of The Garten, explained to The Daily Star over the phone. ''Do you have enough money to pay LL40,000 for a vodka Red Bull?''

For Mourani, opening his nightclub in accordance with the government plan on June 8 is ''not a reality.'' Despite opening his restaurant Standard, in Gemmayzeh, Mourani is struggling to remain upright amid the fluctuating landscape restaurants face. ''We are unable to price anything in the restaurant,'' he explained. ''One day you wake up to a price (from suppliers) and the next day it's another price. Can you imagine the work behind changing prices on the payment system everyday. It's impossible,'' he complained.

But regarding his nightclub, he does not see how it can open when peoples' health concerns remain grave. ''Opening in the middle of this fog is a gamble. There is absolutely no clarity whatsoever,'' he explained referring to coronavirus and the economic chaos.

On an economic level, one solution to circumvent the Lebanese pound's devaluation, is import substitution. Restaurants are already doing this, stripping back their menus to locally sourced foods. For nightclubs, the answer may lie in selling locally produced alcohol. Partner and head of marketing for Factory People, Samer Makarem, sees potential here. ''There is going to be this resurgence in local products, and we will look to see how to promote it,'' he explained, mentioning some ideas in the pipeline. Other club owners acknowledged this option too, but questioned local distilleries' ability to boost production.

Colonel Brewery co-owner Stephan Haddad acknowledged this. ''We are able to boost production but within limits as we are a craft brewery and so we have problems competing with imported alternatives,'' Haddad told to The Daily Star. Nor are they totally local. ''Much of our ingredients such as malts, hops, yeast and ethanol are imported. One liter of ethanol used to cost $1.6, now it is $8,'' Haddad added.

Additionally, the capital controls will restrict nightclubs' ability to pull in internationally acclaimed DJs. The Garten typically spent half a million dollars yearly on guest performers. But now, that is likely to change. ''The days of paying a single act $50,000 to come from abroad are done,'' one nightclub manager said. For other clubs, this is not a major problem such as Ballroom Blitz, who focuses instead on cultivating local talent. ''We have always been putting forward local DJs. If you look at our lineup you'll see this,'' explained Mourani. Makarem from Factory People, embraces the need to change. ''The whole game with international DJs was incredibly inflated and almost killed a fair share for the developing scene. This is an opportunity to continue developing local talent,'' he said.

But as clubs reflect on ways to adapt, the lockdown pressures accumulate. So far clubs are proving relatively resilient to these pressures. Some are managing to pay employees half-salaries or have setup internal funds to distribute cash to employees based on individual needs. Some have already paid the yearly rent on their venues upfront while others spoke of ''understanding landlords.'' Yet the situation is not without pressures. ''If we cannot open before end of summer, we will be in the red,'' Makarem said. ''But even in September, who knows. If the lockdown has to continue and people are barely surviving, clubbing would not have its role for revolutionary reasons.''

Despite the difficulties, Makarem finds faith in Lebanon's resilience in times of crisis. He pointed to 2006, when his company predecessor, launched Safer Underground Campaign, that promoted partying as a tonic in crisis. The idea behind it was to say that while ''everything may be falling apart, the dance floor brings us together,'' Makarem explained, before drawing on the previous generation's experience – ''stories you hear from our parents during the war who still wanted to seek those experiences and just recalibrated their lives ... these things are even more important in times of crisis.''

But partying and social distancing hardly match. Last week, South Korea was gripped by second-wave fears following a virus cluster linked to Seoul's nightlife district. A local celebrity drew public ire after being filmed dancing in a club and massive testing efforts uncovered at least 119 linked cases. Acknowledging the dilemma, Makarem believes there is only so much nightclubs can do. ''We will take all the necessary measures. Our team is dynamic and we are waiting to see how the world is shifting. But we cannot please everyone. At the end of the day it is the customers' choice. People come to a club to forget and escape. You do not want to go to a club and be told to sit on one side and others on the other. It kind of defies the purpose.''





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