Once the Mideast's 'Paris,' Beirut Pulls a Phoenix

After a long absence, the clock tower of the American University once again rises above the Beirut skyline. A landmark to generations of Beirutis, it was razed seven years ago after being damaged in a mysterious explosion.

To many, the reconstruction of College Hall and its signature tower is a symbol of the educational and cultural renaissance now engulfing Beirut, a city whose name just a few short years ago was synonymous with civil war and urban terror.

John Waterbury, a former Princeton University professor, recently took up residence on the campus, becoming the first American University president to do so in almost 14 years. One former president, Malcolm Kerr, was gunned down while walking to his office in 1984.

"Beirut is definitely coming back to life, recapturing some of the cosmopolitan flavor it had before the [1975-1990 civil] war," says Kathy Salameh, a Spanish journalist who has covered the Lebanese capital for 20 years. "It doesn't feel like Paris yet, but there are some positive signs."

Among new signs of life are well-publicized performances by famous artists. James Brown, Jose Carreras, Deep Purple, and the St. Petersburg ballet have all toured here in recent months.

Beirut's publishing industry is also thriving. The city's one-time prominence as a culture capital rested in part on its domination of that industry. Today, Lebanese publishers are putting out more titles than ever.

"Arab writers prefer to be published here," says Bassam Tohme, director of Dar al Sakafa, a major publishing house. "We have better-quality printing equipment than in Cairo, there is no censorship, our work force is well-educated. In addition, there is a kind of prestige to being published in Beirut."

But despite the cultural revival, the Lebanese economy remains in the doldrums. An open letter by the Maronite Christian Bishop's Council recently accused Prime Minister Rafiq al Hariri's government of "wasting vast sums of public money and leading the country toward a dangerous crisis."

On paper, Lebanon's quasi-governmental corporation for the reconstruction of Beirut, Solidere, is doing well. It posted a net profit of $77.8 million for 1997. Critics, however, accuse it of promoting a wave of land speculation.

"Lots of foreign capital is buying up land in the city center," complains Hanna Anbar, editor of the monthly Arab Ad Magazine. "But all of this investment is going toward speculation, driving prices up and doing nothing for industry or the creation of jobs."

And many people are out of work. Lebanon's Bureau for Central Statistics recently calculated that the country has an unemployment rate of 8.5 percent, but some economists put the jobless rate much higher. The official figure, they say, assumes people with menial jobs - selling chewing gum, lottery tickets, or shining shoes - are gainfully employed.

Beirut's French-language Orient le Jour newspaper recently estimated that unemployment was closer to 30 percent.

"What makes matters worse," insists Mr. Anbar, "is that the government does little to control the army of foreign laborers working illegally in Lebanon.

"Another serious problem with the economy," adds Anbar, "is that the Lebanese government is racking up too much public debt, and to pay off that debt it is resorting to all kinds of unprogressive taxes, which hit the working class very hard."

Lebanon's Central Bank recently reported that the country's public debt had reached $14.5 billion - in a country where Gross Domestic Product for 1997 was $17 billion. Paying off debt has driven interests rates as high as 27 percent during the past two years, drying up investment.

The government has raised rates for public utilities, telephones, and automobile registrations, as well as increasing taxes on gasoline and imported foods.

All this, charges the Maronite bishops' letter, means "conditions have become so difficult ... that large numbers of people are trying to leave the country."

Tarek Dimashqui, a merchant who returned here from Canada four years ago, is thinking about going back to Canada. "You can't make a living in this country," he complains. "I pay more in bills than I make in a month."

Still, many hold out hope. One Central Bank official, who asked not to be named, says the government is optimistic that "some of its debt would eventually be forgiven when a peace treaty was concluded with Israel."

"The obvious problem with the Lebanese economy," says Issam Jurdi, business editor of Beirut's influential An Nahar newspaper, "is that potential investors have taken a wait-and-see attitude with regard to the Middle East peace process, and this is leaving Lebanon in a sort of limbo.

"Despite the negatives," he argues, "Lebanon still has a great deal of momentum in its financial-services industry, in the education sector, and with a vibrant population in general."