"Quoting Annahar Newspaper site"
La Regie Libanaise Des Tabacs Et Tombacs (Regie) got its first privilege during the French mandate and it remained until after Lebanon’s Independence. And in spite of the international warnings about the dangers of smoking on the health, the majority of the Lebanese society is known to smoke. As of 1993, after the new management of Regie took office, the work of Regie developed rapidly as it started offering services to the farmers across different regions and worked to control smuggling operations through the Syrian borders.
To have a clearer image, below are some relevant information:
Regie garners great attention and importance for many reasons, namely the fact that it is a public facility still functioning from 83 years.
Other important reasons are listed blow in brief:
The activity of Regie reaches thousands of farmers since the consumption of tobacco in cigarettes and tombacs in shishas are both activities practiced by millions of people.
Smoking has become condemned by international organizations among them the United Nations’ World Health Organization (WHO) that has called for banning the sale of packed tobacco and its planting, if possible. Further to this, it was also decided to stop all tobacco advertisements after being produced for tens of years and linking between manhood and smoking.
The WHO recommendations also call for banning smoking in public institutions and imposing excessive taxes on those who bend or break this law. It also calls for alerting consumers on the dangers of smoking.
Despite all the efforts exerted by WHO and all the conferences it has been holding on a by-yearly basis since 1996 to look into developments aimed at curbing smoking and the production of cigarettes and also to present studies that show the serious damages that result from smoking; 30 to 35 percent of people aged 16 and more are known to be smokers and the male smokers are more than the females. It is also known that the percentage of smokers in poor and developing countries is more than that in industrialized ones.
Despite all WHO efforts, and after adopting a number of its recommendations at public institutions and even at the offices at some of the companies, and also after sending a clear message on all tobacco packs that smoking leads to death, the production of tobacco remains the same; intact. In this regard, the consumption of tobacco in industrialized countries had slightly decreased; however, it actually increased in poor countries which keeps the global consumption stable. In spite of all this, the tobacco industry remains desired and that was established when British American Tobacco purchased 46% of Reynolds American for 47 billion dollars in October 2016.
During Lebanon’s war, Regie was about to die out. Whether at the headquarters in Hadath or in different regions where warehouses are located, Regie facilities were all subject to great damages. Consequently, the management faced a lot of administrative and financial difficulties between 1976 and 1993 to conduct the business of Regie. And thus, the development and revitalization process did not start until a new board of directors took office. The board is chaired by Engineer Nassif Seklaoui and includes Engineer George Hobeika who has lengthy years of experience at Regie, Environmentalist Mazen Abboud, and Doctor Issam Salman. This team, in cooperation with the successive Ministers of Finance, Fouad Siniora, Jihad Azour, Mohammad Shatah, George Qorm, Rayya El-Hassan, Mohammad El-Safadi, Elias Saba, Demianos Qattar, and the current Minister Ali Hassan Khalil, managed to run the activities of Regie and develop them according to the practices of modern administration and this is what the team managed to achieve from the beginning of 1994 until now. Hence, Regie became the only public facility managed by relying on the mentality of the private sector for the interest of the public sector and eventually achieving a noticeable net financial return after deducting all the expenses of conducting the work.
Only Regie, among all other public institutions, managed to abide by the standards of the private sector.
Clearly, if professional organization was generalized, along with the dynamic inclusion of those in charge of the other public facilities, the budget and the general financial situation in the country would have been perfectly fine. For example, through import taxes, the value added tax (VAT), income taxes on the salaries of employees from the tobacco marketing department whether from Regie or other institutions with which contracts were signed to complement the work of Regie but are not from its core duties, Regie managed to provide 7.5% of the treasury income each year. And although the activities of Regie are subject to the recommendations of WHO and also to the market competition due to the excessive influx of smuggled tobacco through the borders especially from Syria, probably eroding 25% of the income that could have been achieved.
Today, after 22 years of continuous organizational and developmental progress, Regie has become the only facility in Lebanon to be an exception when we talk about the regression that had targeted other facilities, namely the electricity, water, mechanique (vehicles inspection), cleaning, public lighting, and others. The shortage in electricity from the year 2000 until 2018 reached in some years 2 billion dollars, and when we calculate all the amounts of money used to support the electricity over 10 years, in spite of the fact that the fuel prices decreased for 18 months between mid-2015 until 2016, it reached without the interest an amount between 19 and 21 billion dollars, thus contributing to a high percentage of the public debt. Also, the mobile and internet services provided by two companies for the Ministry of Telecommunications, had also deteriorated and so did the incomes of the internet. As for the paralyses of the electricity due to Electricité Du Liban’s delay in the engagement in modernization endeavors, this led to 45% of Lebanon’s general debt.
As of 1994 until date, Regie has accomplished results of major importance. These achievements were not solely financial, although the financial ones were really important starting from paying all the debts of Regie as well as the costs of rebuilding and renovating its facilities between 1994 and 1996 and passing through supporting the budget by some considerable resources. All this along with developing the production capabilities and providing social and developmental assistance to agricultural areas.
The administration of Regie accomplished the following achievements whose positive impact could not be questioned:
- It widened the circle of those who benefit from the right of planting tobacco. This circle was limited to those who had licenses and gave them to farmers in exchange of yearly financial charges that the majority of them farmers could not afford. In this regard, Regie limited this right to farmers who are living in agricultural areas and those who have families that will benefit from the planting revenues.
- Regie administration chose to outsource the activities that are not at the core of producing and marketing such as transporting tobacco products from the port to the main warehouse and then to the sub-warehouses, providing and maintaining electricity supply, issuing occupational risk insurance contracts, developing special programs that are related to the daily work results or to the production activities and linking them to information systems, developing training programs for senior employees which were assigned to the Institut des Finances Basil Fuleihan.
Between 1994 and 2015, Regie transferred to the state 4.7 billion dollars and the transfers of 2016 and 2017 reached around 800 million dollars and those of 2018 around 418 million dollars, which makes the average at 6 million dollars while noting that Regie is now producing for international companies that sell significant quantities of tobacco.
On the other hand, what did the other privilege that was given to Electricité Du Liban that was being efficiently handled until 1976 provide?
Continual deficits, declining service levels and the incapability of successive Ministers of Energy since 2008 of achieving any success – noting that they were all from the Free Patriotic Movement – and one of the best FPM economists estimated the losses in the fields of production and transport, as well as the prevention of paying bills by 50 percent of production, and that 45% of the public debt accumulated on the state including interests on the debt, resulted from the deficit of the EDL and the incapability of ministers since 2008 of achieving any reform. In this regard, it is enough to mention that the reparation of a 1.2 km long electrical line in an FPM area of influence that would actually enhance the electricity availability by 10% did not happen.
Therefore, the comparison between Regie and EDL is inequitable and it is not fair that an inefficient board of directors manages EDL and that all the financial results for its work remain unpublished while its budget for reparations and routine works cost 350 million dollars annually. All this and only until 2 weeks ago that the current Minister of Energy became watchful of the benefits of hybrid and electrical cars while these vehicles have been available for years in developed countries. In France for instance, one can use a credit card to rent one of those cars and there is an orientation to eliminate the reliance on gasoline-consuming vehicles. And maybe what’s more important than that is means of providing electricity should these hybrid cars become more available in Lebanon. Could a rusty administration that has increased the budget deficit by 442 million dollars within 3 months provide electricity for those cars?