Policy paper

UK–Lebanon development partnership summary, July 2023

Published 17 July 2023

Introduction

The Strategy for International Development (IDS) places development at the heart of the UK’s foreign policy. It sets out a new approach to development, anchored in patient, long-term partnerships tailored to the needs of the countries we work with, built on mutual accountability and transparency. This approach goes beyond aid and brings the combined power of the UK’s global economic, scientific, security and diplomatic strengths to our development partnerships. Our 4 priorities are to deliver honest, reliable investment, provide women and girls with the freedom they need to succeed, step up our life-saving humanitarian work, and take forward our work on climate change, nature and global health. The Integrated Review Refresh (IR23) reiterates that sustainable development is central to UK foreign policy and sets out how the UK will go further and faster on development to reduce poverty and reinvigorate progress towards the SDGs. This Country Development Partnership Summary details how the IDS and IR23 will be put into practice with Lebanon.

Country context

Lebanon is an important partner for the UK, given the importance of regional stability. The country is experiencing a multi-layered and complex economic, political, and humanitarian crisis. Already under immense pressure from over a decade of hosting the world’s largest per capita refugee population, since 2019 it has been experiencing a rapid economic decline which now ranks among the worst globally since the 19th century. The current crisis is rooted in decades of economic and financial mismanagement, poor governance, and a stagnant political system. COVID-19, the devastating Beirut port explosion on 4 August 2020, and the war in Ukraine have further exacerbated the situation.

The crisis has reversed many of the development gains of recent decades. In July 2022 the World Bank downgraded Lebanon to a lower middle-income country for the first time in 25 years. Between 2019 and 2021 Lebanon’s GDP contracted by more than 58%, the largest drop of 193 countries. Over the same period, the Lebanese Lira lost more than 90% of its value^{[footnote 1]} and has continued to decline. Lebanon’s inflation is amongst the highest in the world^{[footnote 2]}. This has caused a significant devaluation of salaries, wiped out the value of savings and pensions, and driven millions into poverty. Multi-dimensional poverty (covering multiple areas of deprivation including education, health and basic services) has doubled in the past 2 years, affecting more than 82% of households in Lebanon^{[footnote 3]}.

Lebanon’s economic decline has had a particularly severe impact on the approximately 1.5 million Syrian refugees living there, many of whom have been living in the country for over 10 years. With limited employment opportunities and legal rights, most are reliant on humanitarian assistance. According to the Vulnerability Assessment for Syrian Refugees (VASyR 2022), 90% of refugee families lack the capacity to meet the Survival Minimum Expenditure Basket without humanitarian assistance and credit. Only 56% of Syrian children aged 6 to 14 attended school in 2021, while 30% have never attended school^{[footnote 4]}.

Humanitarian need, once limited to refugees, is now seen amongst all population groups, who have been severely impacted by rising costs, gaps in essential services and shortages of critical goods. In December 2021 the UN declared Lebanon a humanitarian crisis in its own right. According to the UN, 3.8 million people are in need of humanitarian assistance in 2023, including 2.3 million vulnerable Lebanese (57% of the resident Lebanese population), 1.5 million Syrian refugees, 180,000 Palestinian refugees, and 80,000 migrant workers^{[footnote 5]}.

Why and how: the UK’s development offer

The UK’s mission is, firstly, to reduce the risk of state failure and support the security and stability of Lebanon’s state institutions. But ultimately, we want to maintain Lebanon as an example of communal co-existence, freedoms, and shared values in the Middle East and North Africa (MENA) region and to help it realise its potential as what it should be: a successful service sector centre in the region.

The UK will draw on the full range of its resources including UK expertise from across His Majesty’s Government, local and central programming, strong technical advisory capability, convening power, leveraging international finance, and close collaboration with likeminded donors and partners.

In the face of a protracted and worsening humanitarian crisis, FCDO bilateral ODA is focussed on delivering inclusive and gender-sensitive humanitarian aid to save lives and help the most vulnerable in both refugee and Lebanese communities. With growing needs across all population groups, we are pivoting towards an approach that is based on vulnerability, not nationality or status.

A durable solution for Syrian refugees in Lebanon is dependent on a political solution in Syria that enables safe, voluntary, and dignified returns. In the meantime, refugees and Lebanese host communities will continue to rely on support from the international community. We will use our convening power and in-house advisory capacity to push for a more efficient, coordinated, and accountable international response in Lebanon, helping limited funds go further.

We will continue a patient development approach, supporting reform of national systems and social policy with a focus on education and social protection. Resilience of these sectors is critical to Lebanon’s recovery in the long-term, and they are areas where the UK has particular expertise and added value. Considering the constraints of the political and economic context, as well as a reduced UK bilateral ODA budget compared with previous years, we are pivoting from large-scale development-focussed investments to more focussed programming where we can maximise UK impact and influence; leveraging UK convening power and diplomatic assets; providing catalytic and agile technical expertise (TA); and drawing on centrally-managed funds where possible.

Political and economic reform is ultimately required to stem growing humanitarian needs amongst Lebanese and enable a more sustainable developmental approach. We use our diplomatic resources to work with likeminded states, including those in the region, to lobby for the election of a president and formation of a government. We are also advocating greater accountability, including justice for the 2020 port blast. We are working collectively with partners to encourage Lebanon to meet the preconditions for an International Monetary Fund (IMF) programme. FCDO and the Department for Business and Trade are progressing bilateral trade and supporting Lebanon’s economic resilience by lobbying on market access, reducing business barriers, and progressing trade policy.

The fundamental stability of Lebanon’s state institutions remains an overarching priority and aligns to the Cross-Whitehall MENA Strategy priorities of shared security and regional resilience. The UK continues to train, advise, and equip Lebanese defence and security institutions to manage security threats and counter drivers of violent extremism. We continue to support accountability and gender-inclusivity in government institutions. These objectives will be delivered through a portfolio of Conflict, Stability and Security Fund (CSSF), Counter-Terrorism Programme Fund (CTPF), and Ministry of Defence projects. We will also build on research funded by the Home Office in financial year 2022 to 2023 to understand and convene partners on the drivers of irregular migration from Lebanon.

We will take a cross-embassy approach to driving gender equality and social inclusion, supporting International Development Strategy and MENA Strategy priorities on women and girls. Successes so far include technical assistance to mainstream gender in social protection systems and to document the rollback on women’s, LGBT+, and human rights (drawing on a centrally-managed FCDO programme); dedicated programming focussed on women’s political participation (CSSF); and capacity building with the Lebanese Armed Forces, General Security, and Internal Security Forces.

Who we work with

• government of Lebanon: we work closely with key ministries and state institutions to ensure UK efforts support nationally-led plans and reforms
• likeminded donors: we work closely with other donors to ensure development and humanitarian work is delivered as efficiently and as effectively as possible. From summer 2023, the UK and the EU will co-chair the informal Donor Working Group in Lebanon
• United Nations and non-governmental organisations (NGOs): UN agencies and NGOs are key implementing partners for UK bilateral ODA. The UN Central Emergency Response Fund (CERF), to which the UK is a major supporter globally, has also made disbursements for Lebanon, including $8.3 million in March 2023. The United Nations Relief and Works Agency for Palestine Refugees in the Near East (UNRWA) provides vital assistance to Palestinian refugees in Lebanon. UK support to UNRWA is managed from the British Consulate General in Jerusalem
• international financial institutions: the UK is working with partners to encourage Lebanon to meet the conditions for an International Monetary Fund programme – widely seen as a key step in enacting crucial reforms and for restoring market confidence. We also engage closely with the World Bank which is a major source of financing through concessional loans, including for the Emergency Social Safety Net (ESSN) and the emergency wheat loan

Key programmes

Key bilateral programmes

• support to the United Nations (UN) World Food Programme (WFP) Syrian refugee response in Lebanon (FCDO, £175.5 million ODA, 2017 to 2023^{[footnote 6]}) provides multi-purpose cash assistance to help Syrian refugees meet their basic needs, including food, shelter, and healthcare. Providing assistance in cash empowers individuals and families to buy what they need most and helps stimulate the local economy. Between 2017 and 2021 the programme helped 14,500 Syrian refugee families on average per month (approximately 87,300 people); In financial year 2022 to 2023, UK support reached 27,180 households (approximately 163,080 individuals) per month for 3 months
• support to Reaching All Children with Education (FCDO, £78 million ODA, 2016 to 2023) supports implementation of the Ministry of Education and Higher Education’s education strategy. Support from this programme was widely credited with keeping schools open in 2022 for some half a million Lebanese and refugee children
• our future bilateral ODA programming intends to focus on humanitarian assistance to vulnerable refugees and Lebanese; supporting the resilience of the education sector to respond to the ongoing emergency; and agile, catalytic technical assistance to social protection systems and aid coordination

Key UK government and centrally-managed ODA programmes

• Education Cannot Wait (FCDO) is a multi-donor fund, to which the UK is the second largest donor globally. $12 million seed funding has been approved for Lebanon’s Multi-Year Resilience Programme (MYRP) for 2022 to 2024. This will reach 233,000 out-of-school boys and girls with non-formal education

• 5 British Council programmes operate in Lebanon: Cultural exchange; Creative economy; Culture responds to global challenges; Schools Connect; and Youth and Civil Society. The British Council’s education programming draws on UK specialist expertise and supports more inclusive and quality education in the long-term. This complements FCDO’s humanitarian-focussed interventions targeting consistent and sustainable access to education for all in the short term

• the Social Protection Technical Assistance, Advice and Resources programme (FCDO) has supported 3 catalytic TA roles in Lebanon: a cash coordination expert to drive efficiency; a Gender Equality and Social Inclusion (GESI) adviser to mainstream gender and inclusion in social protection systems; and a GESI field coordinator to improve the GESI and Gender-Based Violence (GBV) capacity of the Lebanese Ministry of Social Affairs

• Cultural Protection Fund (Department for Culture, Media and Sport) projects range from emergency stabilisation of buildings to conservation training. There has also been collaboration with the Lebanese army, training them in emergency heritage response following the 2020 port explosion

Recently completed programmes

• the Lebanon Host Communities Support Programme (FCDO, £79.4 million (Phase III), 2014 to 2023) supported communities hosting Syrian refugees. It improved infrastructure and services in over 200 municipalities, with over 1.1 million beneficiaries; created over 1,300 new jobs for both Lebanese and Syrian communities; and supported nearly 400 small and medium enterprises

• the No Lost Generation Initiative (FCDO, £92 million, 2016 to 2022) provided non-formal education services to over 150,000 vulnerable children, supporting them to develop basic literacy and numeracy skills. It supported over 120,000 children and women at risk or survivors of violence to access an integrated package of prevention and response services in the most disadvantaged localities in Lebanon

Financial information

Initial allocations have been set internally to deliver the priorities set out in the International Development Strategy (May 2022) and the Integrated Review Refresh 2023, based on the FCDO’s Spending Review 2021 settlement.

The department’s spending plans for the period 2022-23 to 2024-25 have been revisited to ensure HM Government continues to spend around 0.5% of Gross National Income (GNI) on ODA. This was in the context of the significant and unexpected costs incurred to support the people of Ukraine and Afghanistan escape oppression and conflict and find refuge in the UK, and others seeking asylum. The Government provided additional resources of £1 billion in 2022 to 2023 and £1.5 billion in 2023 to 2024 to help meet these unanticipated costs. The Government remains committed to returning ODA spending to 0.7% of GNI when the fiscal situation allows, in line with the approach confirmed by the House of Commons in July 2021.

The country development partnership summaries include the breakdown of programme budgets allocated to individual countries for 2023 to 2024 and 2024 to 2025. These allocations are indicative and subject to revision as, by its nature, the department’s work is dynamic. Programme allocations are continually reviewed to respond to changing global needs, including humanitarian crises, fluctuations in GNI and other ODA allocation decisions.

It should be noted that these figures do not reflect the full range of UK ODA spending in these individual countries as they do not include spend delivered via core contributions to multilateral organisations, or regional programmes delivered by the FCDO’s central departments. Other UK Government departments also spend a large amount of ODA overseas. Details of ODA spent by other UK government departments can be found in their Annual Report and Accounts and the Statistics for International Development.

Figure 1. FCDO bilateral ODA 2023 to 2024: Humanitarian, 100%

100% of FCDO bilateral ODA meets the ODA Strategic Objective of humanitarian preparedness and response.

100% of FCDO bilateral ODA programming for 2023 to 2024 is provisionally marked as significantly focused on promoting gender equality.

FCDO Official Development Assistance allocation

Allocated ODA budget for financial year 2023 to 2024	Indicative ODA budget for financial year 2024 to 2025
£10 million	£12 million

British Council Official Development Assistance allocation

Allocated budget for financial year 2023 to 2024	Indicative ODA budget for financial year 2024 to 2025
£0.15 million	To be confirmed

Supporting information sources

• British Embassy Beirut
• DevTracker Country Lebanon Summary Page
• FCDO Evaluation Repository

1. World Bank, Lebanon’s Crisis: Great Denial in the Deliberate Depression, 25 January 2022. ↩

2. Fitch Solutions, Lebanon Set For Second Highest Inflation Rate Globally In 2022 (fitchsolutions.com) 10 August 2022. ↩

3. ESCWA, Multi-dimensional poverty in Lebanon (2019 to 2021): Painful Reality and uncertain prospects, September 2021. ↩

4. World Bank, Lebanon Public Finance Review : Ponzi Finance? (English). Washington, D.C.: World Bank Group. ↩

5. UN OCHA, Joint Needs Analysis, 2023 [Publication forthcoming]. ↩

6. As of May 2023, an additional £5 million contribution for financial year 2023 to 2024 is in the process of being finalised. ↩