Interview
BEIRUT: President of the Lebanese Farmers Syndicate Antoine Hwayek has criticized the Agriculture Ministry for failing to adopt reliable strategies capable of maintaining a profitable agricultural industry in Lebanon.
“The Agriculture Ministry is not even capable of imposing its conditions on countries exporting to Lebanon with regard to the quality of products allowed to enter our country,” Hwayek told The Daily Star in an exclusive interview late Friday.
Hwayek maintained that countries with free economic systems usually tend to impose harsh conditions on their trading partners in order to make sure that they are receiving high quality products. “Unfortunately this is not the case in Lebanon where everybody imports everything,” he said.
Hwayek argued that it would be possible to protect the interests of farmers and consumers if only the ministry worked successfully on ensuring that other countries are exporting high quality products to Lebanon. “I think that the ministry does not intend to work properly on this issue due to political reasons,” he added.
He noted that countries that intend to open their markets to foreign products must be able to protect their own goods by ensuring cost efficient production. “How can we successfully export our products when other neighboring countries produce at lower costs and sell at lower prices?” he asked.
According to Bank Audi’s Lebanon Economic Report, Lebanon imports an major proportion of its agricultural products, with these imports amounting to $805 million in the first half of 2010, about 10 times the value of agricultural exports, and up by 12 percent, relative to the corresponding period of 2009.
It stated that Lebanon’s agricultural exports amounted to $86 million in the first half of 2010, up 24.6 percent relative to the corresponding period of 2009. Therefore, it added, the agricultural trade deficit reached $719 million in the first half of 2010, up by 10.6 percent from the same period of last year.
Hwayek said that foreign investments in the agriculture sector are nonexistent and only those who are forced to work in this field are doing so in order to be able to survive. “This is why this sector still exists in Lebanon, “ he said. “Nobody would want to invest his money in a non-profitable industry.”
The Investment Development Authority of Lebanon has recently issued a report stating that the agriculture sector’s share in foreign investments constitutes only 1.8 percent of total FDIs flowing to the country.
Hwayek said that many suggestions were previously offered to the government in the aim of improving the sector but none of these demands were implemented so far. “A few years ago, we drafted a law requesting the establishment of a public institution aimed at protecting farmers against natural disasters but it has not yet been ratified,” he said. He pointed out that this institution would have the same duties of an insurance company with funds secured by the government and the farmers themselves.
Another suggestion offered to the government is the establishment of an agriculture development bank for the proper management of funds invested in this sector, said Hwayek.
“This law was ratified but it has not yet been implemented and I don’t think that the Agriculture Ministry has any intentions to establish this very essential entity,” he said.
Hwayek emphasized the importance of establishing such a bank because commercial ones do not provide loans to farmers due to the high risk associated with the sector.
To address the financing and credit problem, Agriculture Minister Hussein Hajj Hassan announced four months ago that he had concluded a written agreement with Fransabank to provide soft loans to farmers: amounts of up to LL25 million at 5 percent interest.
Currently, an estimated 3-4 percent of farmers have access to private loans and the minister’s goal is to see this figure rise to 30-40 percent.
Hajj Hassan has also produced the 41-page “Revival Strategy for the Agriculture Sector: 2010-2014” which lists the perennial problems faced by a sector that employs 20 to 30 percent of the work force, but produces only 6 percent of GDP.
The familiar culprits are there, such as a lack of agricultural extension offices to guide farmers’ cultivation choices; the lack of labeling, quality control and state oversight; weak access by farmers to credit from banks; the excessive and chaotic use of pesticides and the sector’s high-production costs.
More than ten months into the job, Hajj Hassan can now claim some achievements, based on his plan. He began his tenure with a campaign against lax state oversight, and outright corruption; this spread from employees at the ministry to the Customs Authority at the Port of Beirut, where he has exposed rampant illegalities involving imports of both pesticides and foodstuffs.
Asked about the recent hike in the prices of vegetables, Hwayek said that the increase was due to the heat wave that hit Lebanon during this summer and which affected the production of vegetables and fruits all over the country.
Prices of meat, vegetables and fruits rose between 200 to 300 percent in one month as traders justified the high rates as a result of the poor weather conditions and the appreciation of the euro.
Hwayek said he expects prices to increase again this year.
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