A powerful explosion occurred in Beirut’s port area on Tuesday evening. The head of the Lebanese Red Cross said the death toll had reached 100 people, and many of the victims were still trapped under the rubble.
The losses suffered by an already depleted Lebanon are estimated in the billions of dollars. The complete destruction of the country’s main port and everything that was stored there was the most painful blow to the Lebanese economy.
Lebanon’s government has already announced that the country’s grain reserves will last only a month, and that flour won’t be sold at retail. According to Lebanese experts, the catastrophe that happened in Beirut has put Lebanon on the brink of survival.
Losses and Damage
There are various opinions regarding the volume of the losses: of course, the number of explosion victims will be the biggest blow to the Lebanese capital. However, the current Lebanese government has no funds to restore what was destroyed, which can only exacerbate the problems of the Lebanese people.
Lebanese economist Bassem Ajaqah pointed out that there are two types of economic losses for Lebanon: infrastructural and food.
People walk past damaged buildings and vehicles following Tuesday’s blast in Beirut’s port area, Lebanon 5 August 2020.
At the same time, a catastrophe this huge will entail the closure of a number of companies and enterprises that were associated with or located in the destroyed facilities. This means that several hundred or even thousands of people will inevitably lose their jobs.
In turn, economic expert Marwa Othman believes that Lebanon is now unlikely to be able to independently rebuild the city and, moreover, its own economy.
The Port Problem is Deeper Than It Seems
Frankly speaking, Lebanon is not rich in natural resources. Therefore, it has to import more than 70% of consumed raw materials and products. The country’s main logistics hub is ruined. A logical question arises: how can you compensate for its absence?
Although the Ministry of Transport announced on Tuesday night that the bulk of goods will now arrive through the port of Tripoli, its capacity is several times less than that of Beirut.
In this regard, Bassim Ajaka believes that the load could be spread to the ports in Sidon and Tyre; however, this won’t solve the logistical and economic problems.
A drone picture shows the scene of an explosion that hit the seaport of Beirut, Lebanon, Wednesday, Aug. 5, 2020.
In turn, Marwa Othman believes that Lebanon currently doesn’t have the resources to engage in such production transfers.
Food Crisis
Lebanese agriculture is rather poorly developed – due to geographical and climatic conditions – therefore local farmers don’t even meet domestic needs.
Among other things, the port of Beirut hosted warehouses for wheat, flour, and a number of other important food products. Before being transferred to retail and wholesale trade, they were stored there without being transferred to other warehouses. Now Lebanon is left with almost no grain and flour reserves: what we have now is enough for a month at best.
Port warehouses were considered storage location for strategic stocks of raw materials and products: there are no more warehouses or stocks in Lebanon.
Men walk at the site of an explosion in Beirut, Lebanon August 4, 2020
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