Half of Beirut’s traffic lights have stopped functioning in the past two months, dramatically increasing the number of fatal car accidents and heightening the sense of prevailing doom in cash-strapped Lebanon.
Figures shared by the Internal Security Forces with Lebanon’s traffic management centre show there were 33 fatalities caused by car accidents in the country in June, marking a 120 per cent increase compared to April, when traffic lights in Beirut still worked.
The outage has been caused by a struggle between the Beirut municipality and the Traffic and Vehicles Management Authority, a public institution supervised by the Interior Ministry.
The two bodies are fighting over control of the lucrative business of Beirut's parking meters, which generate around $6 million a year in revenue.
For over a decade, the Traffic and Vehicles Management Authority had been using part of this sum for the maintenance of the city’s traffic lights. But because of the disagreement with the municipality, which believes it should receive the profits generated from the city’s parking meters, the money stopped being collected in late 2019.
There was soon no money left to pay Duncan-NEAD, the American-Lebanese joint venture in charge of the upkeep of traffic lights. On May 1, its contract was not renewed.
Since then, about half of greater Beirut’s hundreds of traffic lights turned off due to lack of maintenance, said the company’s manager, Chafic Sinno.
This has caused accidents to spike. The ISF’s figures show that the number of car accidents in the country went up by 74 per cent and injuries increased by 76 per cent between April and June.
"We do not have the numbers for Beirut, but there is no way that numbers would have increased that much if it wasn't for the effect of traffic lights," TMC manager Jean El Dabagh told The National.
Compounded by the closure of many retail shops caused by Lebanon’s ongoing economic crisis and increasingly long power cuts, the outage has caused Beirut to be shrouded in darkness at night.
Many Lebanese expressed surprise and sadness on social media at seeing normally bustling streets shut down after sunset.
The breakdown of Beirut’s traffic lights also brought back harrowing memories of the country’s 1975-1990 civil war.
Elie Helou, an engineer at the Council for Development and Reconstruction, a public body that oversees most of Lebanon’s infrastructure development projects, said that when traffic lights were installed in 2008, many people hailed their return as “historic”.
"When we finished the installation of signals, we heard so many times that it was a historic moment, a turning page of the war," he told The National. "We had [traffic] lights prior to the war, but they were dismantled or demolished."
The construction of traffic lights was financed by a 2003 World Bank loan which included several big infrastructure projects and was worth over $100 million in total, according to Mr Helou.
At the time, the Beirut municipality and the Traffic and Vehicles Management Authority signed an agreement that states the latter would “pay for the operation, development, and maintenance expenses of the parking meters and of traffic lights, and deposit the rest of the money in the account of the treasury of the Beirut municipality.”
The municipality refused to renew the agreement in 2010, because it says that it never received its dues from the traffic management authority.
“We sent them many letters asking why they were not sending us the profits,” said Ghassan Elias, an engineer at the municipality. “We received no answer. We can’t continue like this. We’ve lost millions.”
To defend itself, the Traffic and Vehicles Management Authority points at the fact that the agreement specifies that this payment system would only be put in place “after repayment of the designated loan for these works”.
Here lies the core of the disagreement: the municipality believes that the Finance Ministry has paid back the World Bank’s loan, or at least the part concerning traffic lights and parking meters.
But the Traffic and Vehicles Management Authority says that the loan is still being repaid and that it is bound to a Lebanese law that gives it full authority over the management of parking meters.
A 2003 decree, voted in parallel to the World Bank loan, stipulates that the authority “collects the sums from paid parking and fines…and deposits them in the approved bank.”
Additionally, the Traffic and Vehicles Management Authority pointed out that it does not make enough profit to send to the municipality anyway.
The parking meters generate about 10 billion Lebanese pounds a year, or the equivalent of $6 million at Lebanon’s official exchange rate, which is hardly used since the local currency started depreciating nine months ago.
The money is then used for the parking meters’ upkeep, as well as maintenance of traffic lights and the traffic management centre.
This also costs about 10 billion Lebanese pounds, meaning there is no profit, said Ayman Abdel Ghafour, president of the car registration department at the Traffic and Vehicles Management Authority.
The dispute came to a boiling point when the Beirut municipality launched a lawsuit against the Traffic and Vehicles Management Authority last August. As a result, it stopped collecting money from greater Beirut’s 725 parking meters.
"We sent the contractual requirements to the municipality in late 2019 for a new tender, but they haven't done anything about it," Hoda Salloum, the authority's director, told The National. "There is a vacuum now."
Mr Elias said the municipality was working on updating the requirements.
When asked about the loan, the Finance Ministry referred The National to a recent press release that said that it had nothing to do with the dispute, which only concerns the Traffic and Vehicles Management Authority and the Beirut municipality.
The World Bank did not answer a request for comment before this story went to print.
Former Interior Minister Raya Al Hassan said that she tried to resolve the dispute in 2019. "We decided to launch a bid to basically get a new contractor to manage the parking meters," she told The National. "We agreed afterwards to give probably around 90 per cent to the municipality and 10 per cent to the Traffic and Vehicles Management Authority."
But this process was interrupted when Mrs Salloum was jailed for over a month in December over allegations of bribery in the car registration department. She returned to her job though she was then charged in February with squandering public funds in her management of Beirut’s parking meters.
Mrs Salloum denies the charges, which her supporters say are politically motivated. The current Interior Minister, Mohammad Fahmi, has defended her on social media.
Without proper mediation, the dispute will not be over soon, and the number of fatal car accidents will inevitably continue to rise on the city’s busy roads.
“I do not understand why they have not asked for an opinion from the Committee of Legislation and Consultations, whose job is to solve disputes between government agencies,” said one observer who asked to remain anonymous.
“They’re just hiding behind their desks and throwing eggs and potatoes at each other.”
Our legal consultant
Name: Dr Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
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2.30pm: Handicap Dh 76,000 (D) 1,400m
3pm: Handicap Dh 64,000 (D) 1,200m
3.30pm: Shadwell Farm Conditions Dh 100,000 (D) 1,000m
4pm: Maiden Dh 60,000 (D) 1,000m
4.30pm: Handicap 64,000 (D) 1,950m
Other acts on the Jazz Garden bill
Sharrie Williams
The American singer is hugely respected in blues circles due to her passionate vocals and songwriting. Born and raised in Michigan, Williams began recording and touring as a teenage gospel singer. Her career took off with the blues band The Wiseguys. Such was the acclaim of their live shows that they toured throughout Europe and in Africa. As a solo artist, Williams has also collaborated with the likes of the late Dizzy Gillespie, Van Morrison and Mavis Staples.
Lin Rountree
An accomplished smooth jazz artist who blends his chilled approach with R‘n’B. Trained at the Duke Ellington School of the Arts in Washington, DC, Rountree formed his own band in 2004. He has also recorded with the likes of Kem, Dwele and Conya Doss. He comes to Dubai on the back of his new single Pass The Groove, from his forthcoming 2018 album Stronger Still, which may follow his five previous solo albums in cracking the top 10 of the US jazz charts.
Anita Williams
Dubai-based singer Anita Williams will open the night with a set of covers and swing, jazz and blues standards that made her an in-demand singer across the emirate. The Irish singer has been performing in Dubai since 2008 at venues such as MusicHall and Voda Bar. Her Jazz Garden appearance is career highlight as she will use the event to perform the original song Big Blue Eyes, the single from her debut solo album, due for release soon.
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
MATCH INFO
Sheffield United 3
Fleck 19, Mousset 52, McBurnie 90
Manchester United 3
Williams 72, Greenwood 77, Rashford 79