LEBANON HANDBOOK

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP79-00891A001000030001-9
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 47
• Document Creation Date: December 12, 2016
• Document Release Date: May 6, 2002
• Sequence Number: 1
• Publication Date: November 1, 1971
• Content Type: REPORT

Approved For Release 2002/05/16 : CIA-RDP79-00891A0010 61-'6%6 1-9 6
Secret
Lebanon
Handbook
Secret
N2 .93
No. 0606
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
25X1
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
ARNING
This document contains information affecting the national
defense of the United States, within the meaning of Title
18, s,xtions 793 and 794, of the US Code, as amended.
Its transmission or revelation of its contents to or re-
cenpt by an unauthorized person is prohibited by law.
GROUP
Exciuded from automatic
downgrading and
declassification
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Releas
1A001000030001-9
25X1
TABLE OF CONTENTS
Page
INTRODUCTION
I. GEOGRAPHY
Location and area
1
Climate
1
Natural resources
2
Human resources
3
II. ECONOMIC BACKGROUND
Growth rates and trends
1
Income distribution
2
Main sectors of the economy
2
Transportation and communications
4
Government finance and economic policy
5
Foreign trade
7
Balance of payments
8
III. POLITICAL SITUATION AND TRENDS
Historical summary
1
Structure of the government
2
Political dynamics
3
25X1
IV.
SUBVERSION
VI. ARMED FORCES
Defense organization
1
Manpower, strengths and capabilities
1
Defense budget
2
Logistics
3
Lebanon
Nov 71
25X1
Approved For Release 2002/081ltialta:IkDP79-00891A001000030001-9
Approved For Releas 1A001000030001-9
VII. FOREIGN RELATIONS
VIII. US INTERESTS
MAP
Lebanon
ii
Nov 71
Approved For Release 2002/0NA6ICWRDP79-00891A001000030001-9
25X1
25X1
Approved For Rele
INTRODUCTION
891A001000030001-9
Lebanon practices a precarious balancing act to maintain its unity and
independence. Located at the economic and cultural crossroads of the
eastern Mediterranean, the country is divided almost evenly between Chris-
tians and Muslims, each group with numerous sects, and each tending to
operate in its own social and economic milieu. Political power is allocated
within the parliamentary system on the basis of religion. Stability has
depended on the willingness of each religious community to avoid contro-
versy, an approach that tends to leave some serious domestic problems in
abeyance. The desire to avoid trouble extends to foreign policy; Lebanon has
viewed itself as a bridge between the West and the Middle East, neutral in
great power matters and beyond the range of intra-Arab squabbles and
Arab-Israeli wars.
Lebanon's national character and behavior derive in large measure from
the country's position at the juncture of major air, sea, and land communi-
cations routes. Here Arab invaders, Christian crusaders, missionaries and
educators, and later the French Mandate authorities all brought their influ-
ence to bear. In addition, Lebanon has historically served as a refuge for
religious minorities escaping persecution in their own countries. It was
during French rule, from 1920 to 1943, that Christians became predominant
socially, politically and economically. Although Muslims claim that they
now outnumber the Christians, the division of power which resulted from
the census of 1932 has not been altered, and there is no indication of
sufficient pressure to force a new census within the near future.
The country's economic reliance on external developments provides
additional pressure for policies of compromise. Lacking natural resources?
Lebanon has no oil or other minerals and only a third of its land is
arable?but favored by its location, the country has turned to international
trade and services. It has occupied a profitable position as commercial
middleman between the West and the Middle East, and as banker for the
Arab world, although this latter enterprise has been undermined since the
1966 Intra Bank collapse. In addition, the terminals of the two major oil
pipelines of the Arab Middle East are located there.
By and large, the Lebanese have been able to make a success of their
unusual situation. Of all the Arabs, the Lebanese are the most urbanized and
the best educated, with the largest middle class and the highest standard of
living. Domestic and foreign affairs are conducted under the terms of an
Lebanon
iii Nov 71
iApproved For Release 2002/MMIZIKADP79-008 1A001000030001-9
25X1
25X1
Approved For Re!ear 2002/6'ficIVATRDP7q-OnR11A001000030001-9
unwritten compromise?the National Covenant?which rests on the recogni-
tion by each religious group of the tenuity of its own position in society and
of the overriding importance of avoiding major conflicts. The convenant
provides for proportional representation of religious communities in the
Chamber of Deputies and for division among them of public offices and
political influence. The president of the Republic, for example, is always a
Maronite Christian, the prime minister a Sunni Muslim, and the president of
the Chamber a Shia Muslim.
Conducting national affairs on the basis of compromise and evasion of
conflict has its drawbacks. For example, although some progress was made in
the 1960s, the government has yet to take strong and effective action to
correct imbalance in the economy or to deal with economic inequities that
keep the majority of Muslims in less lucrative occupations like farming.
Nevertheless, the major crisis of 1958 was a clear indication of the dangers of
altering Lebanon's delicate political balance too drastically. What was basi-
cally a Christian attempt to grab a larger share of power developed into an
open insurrection, which ended only after the United States put troops
ashore near Beirut and helped to restore equilibrium.
As a guideline for international relations, the National Covenant stresses
the country's special character as an Arab state with ties to Western civiliza-
tion. Lebanon's friendship with the West, particularly the United States, is
long established, but the balance implied in the covenant has also led to the
country's neutrality in the East-West struggle. The covenant further pre-
scribes strict neutrality in Arab disputes, but the pressure of events, particu-
larly since 1967, has made it increasingly difficult for Lebanon to remain
aloof. The passions of the Arab-Israeli conflict and the growth of the
fedayeen movement have thrust themselves on unwilling Lebanese leaders.
They could threaten Lebanon's detachment and even its domestic stability.
Like other members of the Arab League, Lebanon does not recognize
Israel. It upholds the economic boycott of that country and favors the
return of Palestinian Arabs to their homeland, but it has little desire for
renewed hostilities against Israel. Lacking in military strength and basically
conciliatory in foreign policy, Lebanon did not participate in the 1967
Arab-Israeli war. Growing impatience among other Arabs with Lebanon's
neutrality, and increasing use of Lebanese territory by Palestinian com-
mandos as a base of operations threaten to draw the country into a more
direct confrontation with Israel. The commando issue has also aggravated
tensions between the Christians, who desire continued neutrality, and Mus-
lims, who are torn between their wish to avoid domestic conflict and their
emotional attachment to their Arab "brothers."
Lebanon
iv
Approved For Release 2002/0S1C
11.'1
Nov 71
/VIDP79-00891A001000030001-9
Approved For Release 2002/E4VRCECIRDP79-00891A001000030001-9
The next decade is likely to bring further tests of Lebanon's delicate
social and political balance. As a result of the 1967 war, tourism and
investment have declined. At the same time, the agricultural and industrial
sectors continue to lag behind the commercial and financial sectors, and
unemployment and rising costs of living have encouraged social unrest. So
far the government has managed to contain increased socialist and Arab
nationalist political activities and the efforts by the recently legalized Com-
munist Party to exploit them. Its ability to continue to do so depends,
however, on the willingness of major religious groups to compromise, on
avoidance of direct involvement in regional events, and on some measure of
outside economic assistance for social and economic reform.
Lebanon
Approved For Re
? ?
? M`?
Nov 71
001000030001-9
25X1
25X1
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/0WEICRELFDP79-00891A001000030001-9
I. GEOGRAPHY
Location and area
Lebanon is a small mountainous country nestled on the eastern edge of
the Mediterranean Sea. Bordered on the north and east by Syria and by
Israel on the south, Lebanon lies on the main transportation and trade routes
linking the Middle East with the West. Beirut, the capital and principal port,
lies 230 nautical miles from the northern end of the Suez Canal, 896 miles
from the Bosporus, 1,925 miles from the Strait of Gibraltar, and less than
2,000 miles from the major industrial and trade centers of Western Europe.
Roughly rectangular in shape and comprising some 4,000 square miles
of territory, Lebanon is slightly more than half the size of New Jersey. The
maximum north-south length is about 130 miles, and the maximum east-
west distance is about 50 miles.
Lebanon is generally divided into four geographical regions, running
from north to south. From the sea eastward they are: the coastal plain, the
Lebanon Mountains, the Biqa Valley and the Anti-Lebanon Mountains. The
coastal plain is narrow and sloping, never exceeding a width of 8 miles. The
country's principal cities and a majority of its people are located along the
coastal plain, which boasts a number of shallow, curved bays that provide
Lebanon with its ports and harbors. The Lebanon Mountains rise abruptly
from the coastal plain with few transitional foothills. The mountains extend
the entire length of the country, cross-hatched by numerous steep, east-west
valleys vvhich dissect the western slope. These valleys have been a traditional
safe haven for minorities seeking refuge from political and religious persecu-
tion. The Biqa Valley is a narrow, semiarid plain wedged between the
Lebanon and Anti-Lebanon Mountains, which produces most of the coun-
try's vegetable and cereal crops. It is some 80 miles long and varies in width
from 5 to 15 miles. The Anti-Lebanon Mountains and their southern exten-
sion, Mount Hermon, rise to the east of the Biqa Valley and parallel the
Syrian border. This region consists predominantly of rugged terrain, poor
soils and snow-capped peaks.
Climate
Summers on the coastal plain are hot and humid, with temperatures
ranging from the low 70's at night to the low 90's during the day. The winter
months (December-May) are mild, dominated by 30 of the annual 35 inches
Lebanon Nov 71
Approved For
01000030001-9
Approved For Release 2002/0WftrP79-00891A001000030001-9
of rainfall, and punctuated by an occasional frost and a very rare snowfall. In
the Lebanon Mountains daytime summer temperatures may equal those
along the coast but the humidity is markedly lower; nighttime temperatures
are much lower than those on the coastal plain. Precipitation on the western
slopes averages 63 inches annually. Winters are quite cold and snowfall
heavy. The Biqa Valley receives a great deal less annual precipitation?an
average of 25 inches?than the coast or the Lebanon Mountains, and has
lower relative humidity and wider variations in temperature. Precipitation on
the Anti-Lebanon Mountains is scant and falls mainly in the form of snow,
which covers the peaks a majority of the year.
Natural resources
Agriculture?Agriculture produces more than one third of Lebanon's
exports, but generates only about 10% of the GDP. About one fourth of
Lebanon's 2,570,000 acres are cultivated, but approximately one half of the
cultivated area consists of terraced slopes, making the use of mechanization
and other modern methods almost impossible. Lebanon produces some
agricultural surpluses including apples, citrus fruit, vegetables, and poultry,
and agricultural items are responsible for 36% of total exports. Production is
inadequate to feed the population, however, and foodstuffs account for 23%
of imports, with cereals the largest item on the import bill.
Fuels and power?Oil is the basic fuel used in Lebanon. No petroleum
or coal deposits have been found in the country, but oil from Iraqi and Saudi
Arabian fields flows through privately owned pipelines across Lebanon to
terminals on the coast. The pipeline companies pay Lebanon approximately
$14 million a year in transit fees and supply refineries located at each of the
two pipeline terminal tank farms. Production of petroleum products gener-
ally exceeds domestic demand in all major categories, although fuel oil is the
only locally refined product exported in significant quantity. Imports of
some specialized products are necessary.
Electricity is the primary source of power in Lebanon. In 1970 the
total installed capacity was 664,100 kilowatts and production was almost
1.4 billion kilowatt-hours. Development plans call for the construction of
numerous dams and reservoirs to be utilized both for the production of
electricity and for irrigation purposes. A 120,000 kilowatt thermal power
plant, under construction at Jiyal about 10 miles south of Beirut, was
scheduled for completion by October 1970. An additional 250,000 kilowatts
were to be added to this plant before 1973. Initiated in 1962, the rural
electrification program was to be completed at the end of 1970.
Lebanon
1-2 Nov 71
Approved For Ilelanse 2002105M ? OlArP79-00891p0010 0030001-9
bEC.i:KE
Approved For Release 2002/0WSIptDP79-00891A001000030001-9
Metal and minerals?Construction materials and salt are the only min-
erals exploited in significant quantities. Hard limestone and gypsum occur in
abundance and output satisfies all domestic consumption. In 1967, produc-
tion of dolomite, kaolin, and silica sand was officially reported for the first
time, but production probably actually began years earlier. Although iron
ore and phosphate deposits occur in Lebanon, no plans for their exploitation
are known. The principal limitation on the potential iron ore production is
the extremely poor quality of the ore.
Human resources
Despite the fact that no official census has been conducted since 1932,
and further hampered by the fact that any official Lebanese estimate may
have been influenced by a number of political pressures, US estimators put
the Lebanese population in January 1971 at 2,746,000. This figure includes
more than 1 million people of Lebanese origin living overseas and does not
account for foreigners living in Lebanon, including refugees, whose total was
officially estimated at over 500,000 in 1968. The Lebanese population is
composed of Arabs (93%), Armenians (5.9%), Jews (0.5%), Assyrians (0.1%),
and other minority groups (0.5%). By religion, the proportions officially
accepted for political representation are as follows: Christians (54.9%),
Muslims and Druzes (44.1%), Jews (0.5%) and other sects (0.5%).
Based on the estimated 2,246,000 actual residents in Lebanon, the
average population density is about 560 persons per square mile, the highest
of any Middle Eastern country. Density varies widely from region to region,
with the greatest concentrations in the urban areas along the Mediterranean
coast. Lebanon has a larger urbanized population than any other Arab
country, with the great majority concentrated in the principal cities of
Beirut and Tripoli. Including its suburbs, Beirut's population exceeded
750,000 in 1966 and Tripoli had a population of about 165,000. Most of the
remaining Lebanese live in small villages of from 100 to 150 families.
Lebanon has the highest literacy rate of any Arab country-86%. The
high degree of literacy, especially among young people, is a result of the
rapid growth of educational opportunities. In 1967 Lebanese college stu-
dents received degrees at a rate of 101 for every 100,000 citizens, a ratio
surpassed by only one Middle East country, Israel. Most of Lebanon's one
million employed are literate and have received at least a primary education.
The level of productivity in Lebanon is generally higher than in the re-
mainder of the Middle East, but attempts to improve productivity are
limited basically to on-the-job training. Enrollment in technical and
Lebanon
1-3 Nov 71
Approved For Relense 200910 000030001-9
Approved For c'DP79
vocational schools remains unusually low, due at least in part to the national
distaste for blue collar employment. Unemployment is relatively high but a
number of unemployed are primarily seasonal workers, who can return to
their villages for support when all else fails.
The average Lebanese is a shrewd businessman. He is well educated,
aggressive, and has demonstrated an ability for financial dealing. Coupled
with Lebanon's location at the crossroads between the Middle East and the
West, these talents have made the Lebanese the most prosperous merchants,
traders and financiers in the Arab world. But an economy based largely on
international trade and finance is greatly affected by political upheaval,
especially in the turbulent Middle East. Lebanon's major task will be that of
diversifying its thriving yet unstable economy.
Lebanon
I -4 Nov 71
Approved For Release 2002/0billiCtiMiDP79-00891A001000030001-9
25X1
25X1
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Ra lease 20W-CP6E6A-RDP79-00891A 01000030001-9
II. ECONOMIC BACKGROUND
Growth rates and trends
Until slowed by a series of political and economic shocks that began in
late 1966, Lebanon's economy had achieved a substantial and relatively
steady growth since the end of World War II. Despite the Sinai war in 1956
and the civil war in 1958, GDP* grew during 1954-66 at an annual average
rate of about 5%. As population was growing at about 2.5% a year, per
capita income made a substantial advance. Throughout this period, the
balance-of-payments position was strong, foreign currency reserves were
growing, and domestic price levels were relatively stable.
From late 1966 through 1970, however, Lebanon experienced a series
of upheavals: failure in 1966 of the largest Lebanese private bank, Intra
Bank, the Arab-Israeli war in 1967, the Israeli raid on Beirut International
Airport in December 1968, and clashes between the army and Palestinian
commandos along with Israeli raids in 1969 and 1970. AM of these events
hampered economic activity, slowing real growth since 1967 to somewhat
under 3% annually and nearly stagnating per capita income growth. Because
of a particular sensitivity to instability and uncertainty resulting from
Lebanon's role as the main entrepot and financial center of the Arab world,
the service sector of the economy (including tourism, trade, and banking)
was especially affected. Growth in the major goods-producing sectors of the
economy was not adequate to offset the decline in the rate of growth of
service activities. This condition highlighted the relatively minor role of
industry and agriculture in the total economy, which the government is only
gradually rectifying. The goverment has provided incentives to industrial
development, and since 1967 industrial output and exports have been
increasing very rapidly. The government also is increasing?very slowly?
irrigation facilities for agriculture.
By mid-1971, some of the problems plaguing the economy had eased.
Tourism showed a sizable increase over 1970 rates; early indications sug-
gested that exports would be up; and bank deposits had risen, indicating
some revival in public confidence in Lebanon's financial stability. On the
negative side, however, unemployment remained at a relatively high level,
and general economic activity was up only slightly.
*In Lebanon, GDP does not differ substantially from GNP.
Lebanon Nov 71
Approved For Release 206asatETA-RDP79-00891A001000030001-9
IApproved For Rel ASP 20n2/05/1Efik-79-0on1mm1onoo3 001-9
Income distribution
Although Lebanon's per capita income of about $500 is one of the
higher rates in the Arab world, the average is somewhat misleading. The
Christian population is far more prosperous than the Muslims, who are
predominantly peasants and whose average annual income probably is less
that $75 a year. In addition, little prospect for change is apparent, since the
tax system, like government policy in general, is designed to protect the
interests of the wealthy, and little is being done to spread the affluence of
Beirut to the farming areas of the hinterlands.
Main sectors of the economy
The economy of Lebanon essentially centers around trade and service
activities, which together generate over 60% of GDP. No other one sector
generates more than 13% of GDP.
Agriculture?Agriculture provides about half the population with at
least part of its livelihood and produces more than one third of total exports,
but it generates only about 10% of GDP. Poor soil, inadequate rainfall, and
predominantly mountainous terrain severely circumscribe agricultural activ-
ity.
Farming practices vary widely; primitive methods are still in use on the
many small farms. Approximately half the cultivated area consists of ter-
raced slopes, which make the use of mechanization and other modern
methods almost impossible. On the larger farms in the plains and valleys,
however, the use of modern agricultural equipment has increased greatly
during the past decade, and the use of commercial fertilizers, pesticides, and
herbicides is growing steadily. About one fifth of the cultivated area
(640,000 acres) is irrigated, largely by small privately owned installations.
Because of traditional inheritance practices of dividing land among all
male heirs, many landholdings have become fragmented. This poses serious
problems to expanding agricultural output. Most farmers own their own land
but many plots are too small to provide a living, much less generate funds
adequate to buy fertilizers and other inputs or to allow the purchase of
adjacent, high-priced land. In addition, fragmentation has inhibited private
development of irrigation and drainage or mechanization, as some plots are
so small that even animal-drawn implements are not practical.
Although some aid has been extended, government attempts to help the
farmer have been largely ineffective. The principal effort has related to some
Lebanon
11-2 Nov 71
IApproved For Release 2002/05/105MAR-V1/19-00891A00100 030001-9
Approved For Relea
0001-9
land reclamation and expansion of irrigation. Two agricultural credit agen-
cies have been set up to provide low-cost loans.
The varied topography, soil, and climate of Lebanon favor a highly
diversified agriculture. For the most part, grains and pulses are grown on
nonirrigated land, while fruits and vegetables?Lebanon's major export
crops?are grown on partly irrigated land.
Oil industry?Lebanon has no indigenous supply of crude oil. With oil
supplied to its refineries by pipeline from Saudi Arabia and Iraq, however,
Lebanon is a net exporter of petroleum products, although imports of some
specialized products are necessary. Lebanon, acting as middleman, re-exports
large quantities of imported refined products to neighboring Arab states.
The continuing hostilities between the Arabs and Israelis subsequent to
the June 1967 war led to the closure of the pipeline from Saudi Arabia for
lengthy periods in 1969 and 1970, thus reducing refinery output total
somewhat. Even so, production has increased by 25% from 1965 through
1969.
The pipeline companies pay Lebanon approximately US$14 million a
year in transit fees and supply refineries located at each of the two pipeline
terminal tank farms. The refinery at Tripoli is owned by the Iraq Petroleum
Company. Its capacity is 20,000 barrels per day. The Medrico refinery, near
Sidon, is a joint venture of Mobil and Caltex Oil companies; it has a capacity
at 17,500 b.p.d.
Manufacturing and construction?During the last decade, Lebanon has
become the second most industrialized country in the Arab world, after the
UAR. Manufacturing, however, accounts for only 13% of GDP and employs
only 8% to 10% of the labor force. Almost all manufactures are consumer
goods, primarily for domestic markets. Over half of Lebanon's industrial
income stems from the manufacture and processing of agricultural products
into food, clothing, leather goods, cigarettes, household furnishings, and
beverages. The few large-scale industrial units include electric power plants,
cement factories, two oil refineries, and a fertilizer plant.
To stimulate investment in manufacturing, the government has pro-
vided tax exemptions for certain industrial concerns, has strengthened Leba-
nese chambers of commerce, and has provided limited protection from
foreign competition through preferential import licensing and protective
tariffs. Low interest loans have also been made available. Despite these
Lebanon
11-3 Nov 71
Approved For Release 20021056CISI4ERUP79-00891A00 000030001-9
25X1
25X1
Approved For Release 2002/05/16EMVP79-00891A001000030001-9
moves, however, faster growth of manufacturing has been impeded by a
shortage of long-term capital resulting from Lebanese preferences for invest-
ment in trade, building, and other ventures that offer the prospects of a
quicker payoff.
Industry is highly concentrated both geographically and financially.
Most industrial establishments are located in the city of Beirut and its
surroundings; some 70% of the industrial labor force is concentrated in this
area. About a dozen Lebanese families control most of the larger firms
(those with more than 50 employees). Foreign participation in industry is
limited principally to petroleum refining and the production of plastics,
fertilizer, aluminum and asbestos cement products. Government ownership is
confined to utilities, such as the Beirut water and electricity works, the
postal, telephone, and telegraph services, the railroads, the tobacco products
monopoly, and a factory for spinning natural silks.
The building industry alone normally accounts for approximately 5% of
GDP. After reaching a boom level in 1966, however, construction activity
declined sharply, in large measure because of political and economic up-
heavals. Construction, however, will receive some stimulus in the near future
from government spending if planned major new development projects are
initiated.
Transportation and communications
The development of transportation and telecommunication in Lebanon
has been determined largely by the location of the country on the central
part of the eastern Mediterranean coast and by the mountainous nature of
the land. Much of the overseas commerce of Syria, Jordan, and Iraq passes
through Lebanon. Beirut, a major port, is the shipping center for foreign
commerce and a modern trading post of the Arab world. Two other major
ports, Tripoli and Sidon, serve as terminals for the oil pipelines from Iraq
and Saudi Arabia.
The railroad and highway systems follow similar patterns: each has a
coastal route, a parallel route through the Biqa valley, and a connecting
route extending inland from Beirut. There are three rail and five highway
connections with Syria.. Highway transport is the principal internal mode in
Lebanon and adequately serves present needs. The railroad system is barely
adequate for normal requirements and could not carry heavy traffic for
sustained periods. Most of the track and equipment is old and badly in need
of replacement. Transloading operations are necessary in places because of
Lebanon
Approved For Releas
11-4 Nov 71
.2 win ? ? ? ? ? ? ? ? ?
? ? ? ? ? ?
0030001-9
25X1
25X1
Approved For Release 2002/05/1SECIfitrr79-00891A001000030001-9
gauge changes, and snow from December through March frequently blocks
the narrow-gauge lines across the mountains.
Lebanon has no navigable, inland waterways. Most vessels calling at
Lebanese maritime ports are of foreign registry. The nation's merchant ma-
rine is composed of Lebanese-owned and foreign-owned flag-of-convenience
vessels engaged in international shipping not related to Lebanese traffic
patterns. The international airfield at Beirut is a major interchange point for
transworld carriers, and air transport plays an important role in the Lebanese
economy.
Telecommunication facilities are concentrated in the more densely
populated areas and, although of high quality, do not satisfy requirements.
The wire telephone system is the most important means of communication
but, again, demand exceeds capacity. International radiotelephone connec-
tions are adequate for most of the requirements for this service.
Government finance and economic policy
The Lebanese economy functions largely through the free play of
market forces, with only minor and reluctant government intervention. The
policy of nonintervention has been pursued so assiduously by a succession of
conservative governments that the state participates only minimally in ven-
tures ordinarily considered to be state responsibilities, such as transporta-
tion, health, and education. The opportunity for substantial profits in a
permissive atmosphere has been highly instrumental in establishing Lebanon
as the principal commercial and financial center in the Middle East. Over the
last several years, however, the state has assumed some regulatory powers in
such areas as banking and public utilities and has begun to finance infra-
structure projects designed to stimulate and influence the direction of
private investment.
Over the past two decades, Beirut has become one of the world's major
financial centers. A relatively free economy and a free market in foreign
exchange led to steady increases in the volume of financial transactions and
the size and importance of the banking community. This freedom of opera-
tion, however, led to abuses of acceptable banking practices and, ultimately,
to a banking crisis with the failure of Lebanon's largest private bank in
October 1966. Subsequently, the government increased its regulatory powers
and implemented policies designed to maintain Lebanon's position in world
financial markets.
Lebanon
Approved For Rele
11-5
Nov 71
030001-9
25X1
25X1
Approved For Release 2002/05/1S1tlaFET79-00891A001000030001-9
The failure of Intra Bank and the subsequent collapse in June 1968 of
Al Ahli, the second largest Lebanese bank, led to increased influence for
Lebanon's foreign banking community. Foreign banks, primarily US (for
example, Chase Manhattan, First National City Bank, Bank of America), and
European banks (including the London-based Moscow Narodny) have at-
tracted a growing proportion of both demand deposits and investment funds.
Lebanon's political left has voiced concern over this increasing foreign
influence and has forced the adoption of legislation prohibiting the establish-
ment of additional branches by foreign banks. In 1969-70, the trend toward
foreign participation in Lebanese banking has taken the form of partnerships
with Lebanese banks, some of whom faced the threat of forced liquidation
under the new banking laws.
The Lebanese banking system itself is nominally organized around a
central bank?the Banque du Liban, established on 1 April 1964. It is the
sole banker for the government but does not have any commercial banking
functions, and its central banking powers are severely restricted by legal
limitations on its ability to discount commercial paper from the banking
sector. Prior to the Intra Bank crisis, the central bank used its powers
sparingly because of considerable opposition from the traditionally uncon-
trolled financial community. Monetary policy, accordingly, was very limited.
The budgetary process in Lebanon is far from orderly. Actual expendi-
tures tend to be much less than budget appropriations, while collections
usually exceed estimated revenues. Supplementary appropriations are a fre-
quent occurrence, and special laws often alter the appropriations originally
budgeted. In addition, clear distinctions frequently are not made between
current and investment expenditures.
Most of the revenue received, however, appears to be spent on current
administration, rather than on investment. A significant feature in the
government budget estimates has been the growth of the national defense
expenditures from 15% of the ordinary budget in 1964 to almost 24% in
1970, reflecting the continuing Arab-Israeli crisis and its pressures on the
internal Lebanese security situation.
The structure of the tax system is regressive; the primary sources of
income are indirect taxes and excise taxes, while vast personal fortunes are
untaxed. The Lebanese indirect tax rate can be ranked, on a per capita basis,
among the higher rates in the world today. In periods of economic slack,
these revenues fall drastically. Customs revenues declined by 18% in 1967
after the Intra Bank crisis and the June war. The government responded by
Lebanon
Approved For Relea
11-6 Nov 71
00030001-9
25X1
25X1
Approved For Release 2002/05/1(.1179-00891A001000030001-9
imposing several new taxes?for example, a temporary surchage on income
and property taxes, an increase in inheritance taxes, and a surtax on customs
duties.
The monetary unit of Lebanon, the Lebanese pound, is backed by gold
and foreign exchange and is freely traded. There are no restrictions on
current payments or capital transfers. Foreign capital is not subject to any
special registration and may be imported and exported free of any fees,
taxes, or restrictions. The Lebanese Government on 2 January 1965 adopted
a provisional official parity of LL 3.08 to the US dollar to be used in
valuation of foreign assets and as the unit of account for government foreign
exchange operations. The free-market rate of the Lebanese pound has
fluctuated mildly over the past few years from $1 = LL 3.05 in August of
1965 to $1 = LL 3.24 in January 1971. Little initial change from the
January 1971 rate was apparent following the floating of the US dollar in
mid-August 1971.
Foreign trade
The trade sector of the Lebanese economy generates about 30% of
GDP. The lion's share?estimated at over 20% of GDP?is obtained through
foreign trade, especially entrepot and transit trade. Lebanon usually has had
a surplus in its balance of payments because of substantial earnings from
services and transfers. Dependence on imports, however, has given rise to a
continually growing deficit in commodity trade over two decades. Lebanese
exports in 1968 were only 27% of imports, and the trade deficit increased
from LL 1.1 billion in 1963 to LL 1.35 billion in 1968. The largest part of
the deficit is with Western Europe (including the United Kingdom and
Sweden) and the United States. Lebanon maintains a favorable trade balance
with most Arab countries, which, as a group, took 67% of Lebanese exports
in 1968. Lebanon acts as a middleman to facilitate the movement of
commodities between Europe, Africa and Asia. Transit trade has increased so
rapidly since the closing of the Suez Canal that, in recent years, it has been
almost equal in value to merchandise imports.
Lebanon's trade controls are minimal. They are applied largely for
revenue purposes and to adjust trade to local needs. Continuous and heavy
pressure, however, has been exerted by domestic manufacturing firms for
tariff protection, while opposing pressure has been forthcoming from the
politically powerful merchant-importer group. In this delicate situation, the
government has moved reluctantly by instituting import duties on items that
compete with locally manufactured goods and by lowering or eliminating
import duties on raw materials and equipment required by local menu-
factu rers.
Lebanon
Approved For Relea
11-7
Nov 71
00030001-9
25X1
25X1
Approved For Release 2002/05/46ffi)P79-00891A001000030001-9
Balance of payments
Lebanon customarily has a favorable balance of payments and rising
foreign exchange reserves. A large portion of the trade deficit is covered by
invisible earnings from tourism, freight and insurance, banking, and oil
transit fees. The balance of the trade deficit since the mid-1950s has been
more than offset by inflows of private capital, remittances from Lebanese
abroad, and earnings from unrecorded exports and other illegal transactions.
Beirut is a transit point on the gold transfer route from Europe to
South Asia and the Far East. Nonmonetary gold enters the country legally
and is recorded as an import by customs authorities. However, most of the
gold then leaves the country in the vests or luggage of "couriers" (a practice
not illegal under Lebanese law), and its export is not recorded in trade
figures. The Lebanese balance of payments estimates indicate that LL 325
million worth of gold left the country in 1967, although only LL 12 million
worth was recorded in the legal trade data.
In the uncertain period surrounding the 1967 war, the trade deficit fell
about 20%; however, tourism and investment income also dropped, and
private capital inflow declined dramatically. Over the entire year there was
little change in official reserves. In 1968, however, the balance-of-payments
position improved. Tourism revived, and net receipts from services increased
substantially. The outflow of capital was stemmed and some of the funds
which previously had left the country were returned. In 1969, capital inflow
is believed to have dropped again with increasing instability in the area and
also because of high Eurodollar interest rates. Thus, reserves increased only
moderately as compared with 1968. Similar vacillations can be expected to
continue so long as the critical service sectors (tourism, transportation,
investment income) and private capital flows react to political and economic
events In the Middle East area generally.
Lebanon
11-8 Nov 71
SECRET
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved F
III. POLITICAL SITUATION AND TRENDS
Historical summary
00030001-9
The history of Lebanon is a continuum of invasion and foreign domi-
nation. From about 1,600 years before Christ, Lebanon experienced succes-
sive waves of invaders, including the Hyksos, Egyptians, Assyrians, Baby-
lonians, Persians, Greeks, Romans, Arabs, Crusaders, Turks, and French.
Each of these cultures left its stamp upon the Lebanese, with the net result
of a unique sociopolitical consciousness, varying considerably from one
religious enclave to another.
Following World War I and the collapse of the Ottoman Empire,
Lebanon gained recognition as a national entity and was placed under
French mandate. The country received its independence in 1943, and French
troops were withdrawn in 1946. Lebanon's recent history has been domi-
nated by its presidents (always Maronite Christians): Bishara al-Khuri
(1943-52), Kamil Shamun (1952-58), Fuad Shihab (1958-64), Charles Hilu
(1964-70), and Sulayman Franjiyyah (1970- ). The ends of the terms of the
first two presidents were shaken by political turmoil. President Shamun's
attempt to succeed himself, a violation of the Lebanese Constitution and
regarded by Muslims as an attempt to extend Christian power, led to
insurrection. Further endangered by pressures from radical Arab states, the
Lebanese Government was forced to call for US intervention to help restore
order. US forces arrived on July 15, 1958 and remained until October 25,
1958, after the inauguration of President Shihab and a return to relative
internal stability.
President Franjiyyah gained the support of a Muslim-Christian coalition
and won the August 17, 1970 election by a one-vote majority. A tough-
minded north Lebanese, Franjiyyah strongly asserts Lebanese independence
but is sensitive to the necessity of good relations with both Syria and Egypt.
Franjiyyah asked Saab Salam, a highly adept traditional Muslim politician, to
form a government, and it was generally presumed that the cabinet would be
made up of a broad coalition of various parliamentary groups that helped
elect Franjiyyah. Attempts to this effect were in vain, and Salam decided to
form his government from individuals entirely outside parliament. The new
ministers are primarily young and well-educated "technicians," whose ap-
pointments have been well received by the public.
Lebanon Nov 71
Approved For Release 2002/CitilitatDP79-00891A001000030001-9
25X1
25X1
Structure of the government
000030001-9
The Lebanese Constitution, introduced by the French Mandate gov-
ernment in 1926, is basically Western in form. Originally it was largely
circumscribed by France's mandatory power, but these French rights were
eliminated by constitutional amendments in 1943 and 1947. The constitu-
tion acknowledges the principle that representation in the government
should be in proportion to the strength of the various religious groups in the
country?the well-known National Covenant of 1943. According to this
unwritten agreement, the president is a Maronite Christian, the prime min-
ister a Sunni Muslim, and the president of the unicameral Chamber of
Deputies a Shia Muslim.
Executive power is entrusted to the president of the republic, who
exercises it with the assistance of the cabinet, or Council of Ministers. The
president is elected by the Chamber of Deputies via secret ballot for a term
of six years. A two-thirds majority is required to win on the first ballot;
thereafter a simple majority is sufficient for election. A candidate must be a
Lebanese citizen, literate and at least 25 years of age. The constitution
stipulates that six years must elapse before a past president can be re-elected.
The prime minister and other members of the cabinet may be chosen
either from the Chamber of Deputies or from outside the government. The
president designates the prime minister and charges him with formation of a
cabinet. In choosing the other members, special attention is paid to religious
affiliations in order to give the cabinet as broad a base of popular acceptance
as possible. The cabinet members are jointly and individually responsible to
the Chamber of Deputies for the policies of the government. A no-confi-
dence vote by the chamber forces a minister or an entire cabinet to resign.
There were 16 ministries in the cabinet formed by Saab Salam in October
1970.
Legislative power is vested solely in the Chamber of Deputies, which is
elected by universal suffrage. It meets every year in two regular sessions of
21/2 months each, beginning in March and October. The president may
convene the chamber in extraordinary session at other times, either on his
own initiative or in response to the request of an absolute majority of the
chamber members. Should the president dissolve the chamber, new elections
must be held within three months. Under the constitution, legislation may
be initiated by the president or by the chamber itself. In practice, however,
legislation usually is prepared by the ministry concerned and sent to the
appropriate committee of the chamber for consideration, revision and pres-
entation to the entire chamber, where a majority vote is required for passage.
Lebanon
III - 2 Nov 71
Approved For Release 2002/0SHCREVADP79-00891A001000030001-9
Approved For
0030001-9
By this point, easy passage of the bill is usually assured. The number of
deputies in the chamber is set according to the principle of representation of
the various religious communities in proportion to their numerical strength
as determined in the 1932 census (the most recent formal census taken). The
total number of deputies has always been a multiple of eleven, reflecting the
six to five ratio in 1932 between Christians on the one hand and Muslims
and Druzes on the other. The membership of the chamber was fixed at 99 by
the electoral law of 1960. In order to be eligible to serve in the Chamber of
Deputies an individual must be a literate Lebanese at least 25 years of age.
The term for deputies is normally four years.
Lebanon has two court systems, one religious and the other secular.
The religious courts have jurisdiction, within their own communities, in cases
dealing with violations of religious law as well as with marriage, divorce,
inheritance, and other personal matters. The secular courts, patterned after
the French system, consist of district courts with jurisdiction in both civil
and criminal cases, provincial courts of appeal and a final court of review at
the national level.
Supervision of regional and local administration is highly centralized
and is concentrated in the Ministry of Interior. In each of the five provinces
a governor is the local representative of the central government and is the
executive head of the administrative area. He is appointed by the president
of the republic upon the recommendation of the minister of interior. The
governor is responsible for implementation of the provincial laws, mainte-
nance of public order, administration of the provincial subdivisions, and
efficient operation of public services within his area. The practice of con-
fessional representation applies even in local government; seats on local
councils are apportioned among the various religious groups on the basis of
their numerical strength in the various localities.
Political dynamics
Political allegiance in Lebanon is patriarchal, and patriotism in the
Western sense is virtually nonexistent. Likewise, national political parties as
they are known in the West have not evolved, despite the Western origin of
Lebanon's parliamentary system. Family and religion are still the primary
determinants of political affiliation. Although some international and intra-
Arab parties function in Lebanon, modern political ideologies are only
beginning to be understood.
Lebanon
III - 3 Nov 71
Approved For Release 2002/05/RIS?:;=-IRDP79-00891A001000030001-9
25X1
25X1
Approved For Release 2002/0tECREADP79-00891A001000030001-9
The key to power in Lebanon is in the office of the president. He
designates the prime minister, greatly influences the composition of the
cabinet, appoints provincial governors and other high officials, issues execu-
tive orders in accordance with existing laws, negotiates and ratifies treaties
(subject to approval by the Chamber of Deputies for financial and commer-
cial treaties), dissolves, adjourns and calls special sessions of the parliament,
and initiates legislation and constitutional revisions. The president also has a
suspensive veto, and is given legislative power by the constitution in two
specific instances: 1) he may enact the national budget by decree if the
Chamber of Deputies fails to act, and 2) he may promulgate by decree a
measure which the government (the president and the cabinet) has desig-
nated urgent if the chamber fails to act within 40 days. Because of these
considerable powers, a change of executive affects the political fortunes of a
great many appointees throughout the government. There is, therefore, a
natural tendency for inertia among these appointees, who resist replacement
of the president. Efforts to change the constitutional provision prohibiting
two successive terms for a president have been the source of considerable
controversy and periods of extreme violence in the past. Future attempts by
a president to succeed himself or by elements inside or outside the govern-
ment to manipulate election results, would be sufficient to reawaken tradi-
tional animosities between the Christian and Muslim segments of the coun-
try.
Since the 1970 election of President Sulayman Franjiyyah, known
political groupings in Lebanon have been so fragmented and political lines so
clouded that a description of major political parties using pre-1970 labels is
of no use. With the election of a compromise candidate (Franjiyyah) and the
defeat of the major Shihabist and Shamunist party candidates, political
alignment in Lebanon has been thrown into a state of flux. Both Shamun
and Shihab enjoy the support of small contingents in the parliament, but
these factions are a fraction of their former size and popular support for
these two rival former presidents has declined in similar fashion. Contem-
porary Lebanese domestic politics is experiencing major reorganization as
key influential strong men maneuver in preparation for the 1976 elections.
A serious threat to Lebanese stability issues from Lebanon's contra-
dictory and controversial position as an Arab state which maintains close ties
to the West. This position has led Lebanon to espouse the cause of her Arab
cousins against Israel while at the same time hoping to avoid any direct
military confrontation with her southern neighbor. The increase of Pales-
tinian guerrillas in Lebanon's southern regions plus recent measures the
guerrillas have taken to go underground have been a source of growing
Lebanon
III - 4 Nov 71
il
Approved For Keiease zuuziiREER,Ecirv
tuiu-uudui AIM 00 030001-9
25X1
25X1
iApproved For elease 2002/6EYWRiaTiRDP79-00891A00 000030001-9
concern to the Lebanese Government. In mid-July 1971 the government
announced that the army would fire upon any fedayeen who did not comply
with government restrictions on fedayeen activities. (See Subversion.) Yet,
any indications that the army intended to carry out such a program could
inflame the Muslim segment of the population, which supports the fedayeen,
and thrust the country into renewed conflict between Muslim and Christian
factions.
In recent months, President Franjiyyah has successfully steered his own
appointees into the key positions of commanding general of the army and
chief of the Deuxieme Bureau, in the persons of Major General Iskandar
Ghanim and Colonel Jules Bustani. Both officers are very capable and have
records as efficient administrators. The appointment of these two apolitical
officers is vitally important to the President, since they replace two former
Shihabist sympathizers. These two positions are essential elements of the
President's administrative control because of the effect they can have on the
stability of the country. The army's prime mission is the maintenance of
internal security, and in Lebanon, where interreligious conflicts can lead to
bloody insurrection, a well-trained and disciplined army can act as an
effective buffer force. In addition, parliamentary elections, upon which
presidential election depends, are usually held on four consecutive Sundays
in the different regions of Lebanon. This system allows security forces to
concentrate their efforts in the designated areas on a given Sunday and
interdict any attempts to disrupt the elections. The longevity of the present
government will depend on how it addresses itself to the recurrent Lebanese
problem of presidential succession and the threat of the fedayeen and their
Muslim supporters. President Franjiyyah has taken a strong step toward a
solution through the appointment of two key military commanders, but
ultimate success or failure depends on how they handle their responsibilities.
Lebanon
Approved For
III - 5
U g a s- - op:- ?
Nov 71
000030001-9
25X1
25X1
25X1
25X1 Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Next 1 Page(s) In Document Exempt
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
NOISIMASEIS
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved F
IV. SUBVERSION
030001-9
The fragmented nature of its society and the heavy dependence of its
economy on trade make Lebanon unusually susceptible to both domestic
and outside pressures. Furthermore, the government has been slow to make
the social and economic reforms necessary to cope with the country's
inequality of wealth, underemployment, and the growing discontent of
students and workers. Critics of the government, however, are themselves
divided along social lines paralleling those of the country as a whole, and as a
result they have not been able to coalesce into a significant antigovernment
force. Nearly all groups are agreed on the need to preserve the Lebanese
state, but the sensitive balance among religious groups, on which the govern-
ment depends, is very susceptible to national crises.
Neither the various Communist party factions in Lebanon nor the other
opposition political organizations?the Ba'th Party, the Social Nationalist
Party, the Muslim Brotherhood, and the Islamic Liberation Party?present a
direct threat to the government. Nevertheless, should they join forces with
the commando organizations (Fatah, the Popular Liberation Forces, the
Popular Front for the Liberation of Palestine, and Al-Sa'iqah), which com-
mand a great deal of popular sympathy, they could present a serious threat
to internal stability.
Lebanon's relationship to the Palestinian commandos has been a divi-
sive issue since the 1967 Arab-Israeli war. Those who see Lebanon as part of
the greater Arab nation?primarily the Muslims?view Lebanese participation
in the Palestinian struggle as an inescapable obligation. They consider that
the commandos have a right to carry on the struggle from any part of the
Arab homeland. Those who see Lebanon as a unique state with a character
distinct from that of the Arab countries?primarily Christians?are opposed
to Lebanon's being drawn into the Palestinian struggle and are against the
commando presence in Lebanon.
The principal objective of the commandos is the destruction of Israel,
not of Lebanon, but efforts by the Lebanese Government to restrict terrorist
activities in order to avoid Israeli retaliation have resulted in alienation
between the commandos and the government. However, the attempts of the
commandos to extend the areas of their activities and to take control of the
refugee camps in Lebanon have tended to solidify public opinion behind the
government, even among some Muslims. The Lebanese are particularly wary
of Syrian support of the commandos and the consequent threat to Lebanese
Lebanon Nov 71
Approved For Release 2002/A6IVATRDP79-00891A001000030001-9
25X1
25X1
Approved For
000030001-9
sovereignty and independence; the lesson of Syria's interference in the civil
war in Jordan in September 1970 will not soon be forgotten in Lebanon.
The subsequent dismemberment of the commandos by the Jordanian army
in July 1971 has greatly increased the numbers of fedayeen who have
relocated in southern Lebanon. President Franjiyyah's mid-July statement
that commandos failing to cooperate fully with Lebanese army controls
would be fired upon has committed the army and the government to a less
flexible course of action. It remains to be seen whether the army will be
forced to carry out this policy and how violently the Muslim segment of the
population will react if they do.
General stability in Lebanon, but not the government itself, is also
threatened to some extent by the Communist capability of creating labor
unrest. Since about 1967 the Communist Party of Lebanon (CPL) has made
a special effort to penetrate the trade union movement, and it has succeeded
in placing a few of its members in important positions. The Communist-
controlled National Federation of Labor Unions has been licensed by the
government, making it the first officially recognized Communist labor fed-
eration in the eastern Arab world. In the other labor unions the Communists
seem to have gained influence because of their attacks on the government's
lack of social legislation and also because of their charges that the national
union leaders are hirelings of business and of politicians.
The CPL has also made a special play for influence with certain small
minority groups. Elements of the Armenian minority, which constitutes
5.9% of the population, have been very active in the party. Artin Madoyan,
an Armenian, was one of the founders of the CPL and has remained an
important leader. Other Armenians are or have been members of the Central
Committee and the Politburo; many cells are composed entirely of Arme-
nians. A great deal of Communist propaganda has been directed toward this
ethnic group, but despite this effort, candidates and/or sympathizers of the
anti-Communist Tashnak Party have always won the parliamentary seats
reserved for Armenians.
Lebanon
IV - 2
Nov 71
Approved For Release 2002Ieat6RcHAIRop79-00891A001000030001-9
25X1
25X1
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
25X6 Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Next 3 Page(s) In Document Exempt
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/WeRCf43IRDP79-00891A001000030001-9
VI. ARMED FORCES
Defense organization
The Lebanese Constitution does not define the position of the armed
forces within the government. By various laws and presidential decrees,
however, the President of the Republic is vested with the equivalent power
of commander in chief. Although the president nominally is assisted in the
direct exercise of military authority by the prime minister and the minister
of national defense, in actual practice he maintains direct contact with the
commanding general of the army.
The armed forces have always followed French patterns in organization,
tactics and staff direction. Modifications of French doctrine and concepts
were introduced in the late 1950s when the Lebanese began to receive
military assistance from other Western countries, principally the US, Great
Britain and Belgium. The changes which the Lebanese have incorporated into
their military establishment from foreign sources served to,modernize and
improve their units.
The commanding general of the army is the highest military authority
and commands all components of the Lebanese Army, which includes naval
and air forces. The three elements of the armed forces have their respective
headquarters in Beirut. All support activities, including staff and logistic
support, are rendered by the army.
Manpower, strengths and capabilities
On 1 January 1971 Lebanon had an estimated 670,000 males between
the ages of 15 and 49, excluding Palestinian refugees. Of these, approxi-
mately 395,000 were considered fit for military service. The average number
of Lebanese men reaching military age (18) annually is about 28,000. The
armed forces have generally been able to select well-qualified recruits, but
recruitment efforts were less successful in 1969-70. Although literacy is not
a major consideration for acceptance into the service, most of the enlisted
men are literate.
The armed forces of Lebanon consist of a conventional army and air
force, a coast guard navy, and several paramilitary forces; together they total
21,800 men. The army has about 14,100 men, including 18 battalions: nine
infantry, one commando, three field artillery, one antiaircraft, two tank, and
Lebanon Nov 71
Approved Fo
1000030001-9
Approved For Release 2002/0SipialkiRDP79-00891A001000030001-9
two reconnaissance. The navy has 200 men with one landing and five coastal
patrol craft. The air force has 1,200 men and 37 aircraft, about 19 of them
jet fighters. Of the paramilitary forces, the National Gendarmerie has 5,000
men and the Beirut and Judicial Police another 1,300.
The Lebanese Army is capable of maintaining internal security, except
possibly against a full-scale uprising by the fedayeen including military
support from Syria. It has no offensive capability and can only be counted
on to execute delaying or harassing action against an invasion force and to
conduct guerrilla operations from bases in the Lebanese Mountains. The
army's main effort is currently directed toward defending the border with
Israel and halting operations of the fedayeen commandos attempting to use
Lebanese territory as a base for attacks on Israel. Personnel and units are
well trained by Middle Eastern standards. Morale has deteriorated following
the army's poor performance during an encounter with an Israeli raiding
force on 9 May 1970. Personnel have gained some combat experience from
several army-fedayeen engagements which took place in late 1969 and 1970.
The Lebanese naval forae is capable of fulfilling its mission of patrolling
the coast to suppress smuggling and illegal entry, but it is not capable of
defending itself or the nation against an attack by other naval forces.
Lebanon is totally dependent on foreign assistance for the construction of
naval craft. The mission of the air force, an integral part of the army, is to
provide close air support to the ground forces in the maintenance of internal
security. Despite its small size, the air force performed effectively during the
revolts of 1958 and 1961. Only token resistance, however, could be made
against the air force of any of Lebanon's neighbors.
Defense budget
Domestic production of military equipment is restricted to quarter-
master items such as uniforms and other personal equipment; all other
materiel must be obtained from foreign sources. The main non-Communist
suppliers of military assistance are France, the United Kingdom and the
United States. In 1969 Lebanon obtained rifles from Poland and had
previously received trucks from the USSR. Despite press announcements
that Lebanon will purchase Soviet arms, Lebanese officials have privately
indicated that they intend to purchase US and other Western arms and that
the press announcements were issued to placate leftist political demands. In
early 1964, when Lebanon became a member of the Unified Arab Command
(UAC), the other member states committed themselves to finance in part a
modest program of expansion for the Lebanese Armed Forces. In return,
Lebanon
VI - 2 Nov 71
Approved For Release 2002/05/16s ? CIA-RDP79-00891A001
ST,CRE'l
000030001-9
Approved F
? A.!.?????? ? ???? ??? ?
? ? . ??? ?? ?
0030001-9
Lebanon modified indigenous troop deployment to strengthen its military
posture along the Israeli border. As long as Lebanon's role in the UAC
defense plan remains modest, no monetary problems are foreseen. However,
UAC pressure on Lebanon's armed forces to take a much larger, more active
part in the fight against Israel could create serious budgetary problems for
the Lebanese government.
Budget requests for each of the services are submitted to the Ministry
of National Defense, where the military budget is developed. This budget is
incorporated into the national budget by the Ministry of Finance and
presented to parliament, where it is enacted into law. Defense appropriations
for 1966 through 1967 are shown below.
ANNUAL DEFENSE BUDGETS
(Millions of US dollars*)
1966
1967
1968
1969
1970
Defense budget
34.3
39.5
44.1
51.9
55.7
Percent of total budget
17.7
18.9
18.9
21.6
20.7
Percent of GNP
3.4
3.2
3.2
3.6
3.6
Logistics
The logistic system would not be capable of adequately supporting the
armed forces in time of war. Most items of supply and all major equipment
must be purchased abroad, and reserve stocks would soon be depleted unless
constantly resupplied by foreign sources. Supply personnel are few, and they
would be unable to cope with the increased requirements of combat. The
system functions efficiently, however, for peacetime operations.
Except for ammunition, the quantity of materiel in storage is small.
The following reserves are maintained: rations, 30 days; clothing and organ-
izational equipment, 15 to 30 days; POL, 7 days; other categories, 21 days.
*Dollar value converted from Lebanese pounds at the official exchange rate of 3.08
pounds to $1.00.
Lebanon
VI - 3 Nov 71
Approved For Release 2002/01iblAtItADP79-00891A001000030001-9
25X1
25X1
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For rIc\a.sc 2002/0%Actit&rkDP79 00891A001000030001-9
VII. FOREIGN RELATIONS
Lebanese foreign policy is formulated within the limitations imposed
by the country's small size and its dependence upon commerce, and particu-
larly by the conflicting pressures originating in the Muslim-Christian dichot-
omy. Foreign policy is guided by the modus vivendi established by the
National Covenant, in which Muslims and Christians agreed that neither
would seek to bring Lebanon under foreign control; that Lebanon, although
an Arab country, would preserve its cultural ties with Western civilization;
and that Lebanon would not take sides in disputes between other Arab
states. In return, Lebanon expected its Arab neighbors to respect its sover-
eignty. Lebanon's adherence to the Arab League and its collaboration with
other Arab states constitute recognition of the pro-Arab inclination of the
Lebanese Muslims. On the other hand, Lebanon's neutrality in intra-Arab
disputes and its opposition to inclusion in any Arab unification scheme
reflect the Christians' desire to avoid involvement in pan-Arabism and their
fear of being submerged in a unified Arab state dominated by a Muslim
majority.
In the larger international context, Lebanon's traditionally friendly
relations with the Western powers have stemmed from the pro-Western bent
of its Christian population. The Muslim population, largely distrustful of the
West and influenced by Arab nationalist "positive neutrality," is strongly
opposed to close ties with the West. Thus, despite general opposition to
Communism and growing distrust of Soviet motives in the Middle East,
Lebanon assumes a nominally neutral position between East and West.
The presence of Palestinian commandos in Lebanon has endangered the
Lebanese policy of avoiding open conflict with Israel. Terrorist attacks
against Israel increased during 1969 and 1970, as did Israeli retaliations
against Lebanese villages suspected of harboring terrorists. There also were
occasional encounters between Israeli and Lebanese military forces. The
most serious incident occurred on 12 May 1970, when Israeli forces pene-
trated 10 miles inside Lebanese territory and surrounded six villages for 32
hours in order to clear out a band of fedayeen. The Lebanese Army, aware
of its military inferiority, did not interfere on a large scale and as a result
sustained few casualties?although in an attempt to save face it claimed to
have suffered many. Israel was again censured by the UN Security Council
but continued to shell and bomb Lebanese villages and started sending
"preventive patrols" across the border. The Israeli actions were intended to
induce the Beirut government to crack down on the fedayeen, but instead
Lebanon Nov 71
IApproved For Release 2002/0MkAtag-I(UP(9-00691A0 1000030001-9
25X1
25X1
Approved For Rcic\a.sc 2002/0a4CUIDP79 00891A001100030001-9
they tended both to erode the government's ability to oppose the terrorists
and to increase Lebanon's involvement in the Arab-Israeli conflict.
Relations with Syria and the UAR are of greater importance to Leba-
non than those with other Arab states. Relations with Syria have never been
good, because Syrian nationalists have never accepted the separation of
Lebanon from Syria by the French mandate authorities, and Lebanese
nationalists have always been suspicious of Syrian expansionist aims. An-
other major source of irritation between Syria and Lebanon has been their
divergent economic policies. The economic union which existed under the
French Mandate ended in 1950 when Syria adopted a policy of economic
nationalism and protectionism while Lebanon continued its laissez-faire, free
trade policy. Whenever there are political disagreements between the two
countries, Syria can exert pressure by closing the border, thereby cutting off
Lebanese trade with most other Arab states. Another irritant is Lebanon's
practice of granting asylum to political refugees from other Arab countries.
The most serious problem between the two countries, however, is that of the
Palestinian commandos. Since late 1968, members of the Syrian-backed
Al-Saiqah organization have been launching raids against Israel from Leba-
non with the active support of the Syrian Government. Since the November
1970 coup in Syria, however, relations between Damascus and Beirut have
improved greatly, and a permanent commission has been set up to deal with
matters of common concern.
Relations with Egypt prior to 1955 did not have the high degree of
interaction that was present in Lebanese-Syrian relations. When the Nasir
regime adopted an aggressive Arab nationalist policy, however, relations with
Egypt became a matter of increasing concern to the Lebanese. These rela-
tions deteriorated seriously after the Suez Crisis in 1956, when Lebanon
refused to join other Arab states in breaking diplomatic relations with the
United Kingdom and France. Relations with both Egypt and Syria reached a
very low point during the Lebanese crisis of July 1958, when the newly
formed United Arab Republic composed of Egypt and Syria supported
antigovernment forces in Lebanon. Egyptian efforts to influence Lebanese
policy, both internal and external, continued until 1967. Since the 1967 war
Lebanese-Egyptian relations have improved, and the UAR has twice medi-
ated disputes between the Lebanese Government and the commandos?in
May and again in November of 1969.
Officially, relations between Lebanon and the United States have been
characterized by a friendliness that stems from a long history of US philan-
thropic and cultural activities in Lebanon and from ties with emigrant
Lebanon
VII - 2 Nov 71
Approved For Release 2002/05MCIZZ=MP79-00891A001000030001-9
25X1
25X1
Approved-For?Release-20420894A004000030001-9
Lebanese colonies in the United States. Since World War II, extensive
commercial relations have developed between the two countries because of
the growth of the oil industry in the Middle East and the great expansion of
US business interests in the area. US firms, attracted by the laissez-faire
economic policy of the Lebanese government and the advantageous terms
and facilities offered to foreign capital, have located most of their regional
offices in Beirut. Lebanon, like the other Arab states, has protested the
reduction of the US financial contribution to the United Nations Relief and
Works Agency and the sale of American military equipment, especially
aircraft, to Israel. Nevertheless, Lebanon has sought US assistance in mod-
ernizing and strengthening its own military forces.
Esteem for the US plummeted during the 1967 Arab-Israeli war as
many Lebanese were at first inclined to believe Egyptian allegations of US
assistance to Israel. The government, however, resisted Arab nationalist
pressure to break diplomatic relations with the US and to boycott its
products, and instead merely requested the temporary recall of its ambassa-
dor. Although most government officials are still personally pro-American,
official relations have remained on a low level because of the pressure of
Muslim public opinion. With each successive Israeli raid against Lebanon, the
prestige of the US, which is regarded as the principal backer of Israel, sinks
lower. The US vote in the Security Council censuring Israel for the Decem-
ber 1968 airport raid and also American expressions of concern over the
October 1969 disorders involving the commandos were appreciated by
officials in Beirut. However, US abstention from the Security Council
resolution which reproached Israel for the border incursion on 12 May 1970
was a source of disappointment, as was a similar abstention on the resolution
following an Israeli incursion on 4 September.
The special position of France was first formalized in 1740, when its
particular interests in the Maronite and other Catholic communities was
recognized. This French connection with Levantine Christians, together with
the growth of French economic and cultural interests, was the rationale for
establishing the French Mandate over Lebanon and Syria following World
War I. In its first decade of independence, Lebanon maintained closer
relations with France than with any other major power. The French concen-
trated on maintaining their commercial and cultural interests in Lebanon, a
policy which has paid large dividends. After the 1967 Arab-Israeli war
France imposed an arms embargo on all combatants, but this did not affect
Lebanon. In fact, France has provided more military equipment to Lebanon
(including 11 Mirage aircraft) than has any other country since 1957.
Lebanon
VII - 3 Nov 71
Approved For elease 2002/05ICRI4p-RDP79-00891A001 00030001-9
Approved For Release 2002/0&ECRIEfkDP79-00891A001000030001-9
Following the December 1968 attack on Beirut airport, France offered
Lebanon "total support" against the Israeli threat.
Lebanon's official policy of neutrality obliges the government to make
a show of treating the Soviet-oriented countries and the Western powers
equally. The Soviet Union has considerable prestige among Lebanese Mus-
lims because of its support for the Arab states. Moscow's prestige suffered
somewhat because of its failure to come to the aid of the Arabs during the
June 1967 war, but it subsequently grew even stronger because of the Soviet
re-equipment of the UAR armed forces. The USSR also exerts a degree of
influence on the Greek Orthodox Church in Lebanon through the latter's
traditional ties with the Russian church. Most Lebanese, however, and
especially the Christians, are suspicious of the Soviet Union and other
Communist countries and are wary of attempts by those countries to
establish closer relations. Soviet efforts in this direction have been concen-
trated on culture, trade, tourism, and civil aviation. A Soviet cultural center
was opened in Beirut in 1963 and a cultural agreement was signed in July
1968. The Soviet Union has offered economic and technical assistance for
the Lebanese development plan. Lebanon has rejected most of these offers,
despite pressure from leftist political groups to accept them, but it did
decide to buy $1.5 million worth of military equipment from the USSR in
October 1971.
Lebanese relations with the Eastern European Communist countries
have been correct but cool. Lebanon has diplomatic relations with Bulgaria,
Czechoslovakia, Hungary, Poland, Romania, and Yugoslavia at the ambassa-
dorial level, and East Germany maintains a trade mission in Beirut. Regular
civil air flights between Lebanon and Communist countries have been estab-
lished, and banks of several Communist countries have opened branches in
Lebanon. Lebanon, following the US lead, voted for Communist China's
admission to the UN in October 1971. Official recognition of Communist
China was extended in November 1971.
Lebanon
Approved For
VII-4 Nov 71
0001-9
25X1
25X6
25X1
Approved For Release 2002/0SE31JK-VDP79-00891A001000030001-9
Support for the United Nations as a guarantor of the peace and security
of small nations is a basic foreign policy principle. Lebanon is an original
member of the United Nations and participates in most of its affiliated
agencies. The 13th session of the General Assembly in 1958 was presided
over by former Lebanese Foreign Affairs Minister Charles Malik. The Leba-
nese delegation generally votes with other Arab League members on ques-
tions directly related to Arab affairs; in other matters it tends to support the
Western position whenever it can do so without seriously offending neutral-
ists or Arab nationalists.
Lebanon
Approved For R
VII - 5 Nov 71
1.7 ? ? 1
0030001-9
25X1
25X1
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
S.LS31:13.LNI Sfl
Approved For Release 2002/0$ECOE-RbP79-00891A001000030001-9
VIII. US INTERESTS
Economic aid in the form of a technical assistance program extended
by the US to Lebanon between 1951 and 1962 totaled almost $80 million.
At the same time, the US has been the second largest source of military
equipment for Lebanon, supplying $11 million in equipment between 1957
and 1969. In addition, a PL-480 agreement was signed in June 1970 for
approximately $7 million in agricultural commodities.
The United States has a special interest in Lebanon as a haven of
economic freedom and political stability in the Middle East. These are the
circumstances that have led to the establishment of Beirut offices by over
460 US commercial enterprises and 13 US banks. Lebanon places no restric-
tions on US commercial representation with the singular exception of
banking. A restriction has been placed on the establishment of new branch
offices in Lebanon, to comply with regulations applying to the entire
commercial banking sector following the 1966 Intra Bank liquidity crisis. As
a result, banks may no longer be solely foreign-owned, but must be held by
joint Lebanese-international affiliates. Bunkering and terminal facilities for
the Trans-Arabian Pipeline (Tapline), owned by the Arabian-American Oil
Company (ARAMCO), are located at Sidon. A newly negotiated transit
agreement provided the Lebanese ,Government with approximately
$2,750,000 for the first six months in 1971. During this period Tapline was
pumping crude oil at only 75% total capacity, and reports for July and
August 1971 indicate that crude oil transit had dropped to 50% total
capacity. In addition ARAMCO owns and operates the Mediterranean Refin-
ing Company in Sidon, with a capacity of 17,500 barrels per stream day.
Total LIS investment in Lebanon is estimated somewhere between $150 and
$200 million. US imports from Lebanon for the first six months in 1971
totaled $1.5 million, while exports exceeded $10 million. Between 1966 and
1970 US imports averaged $9.8 million and exports to Lebanon averaged
$75 million.
Lebanon Nov 71
Approved For R
M.Mh?O ? ???? 144 ?
w
%
0030001-9
36100'
6?30,
LEBANON
International boundary
Armistice line (20 July 1949)
Province (Muhafazat) boundary
National capital
acjaj Province (Muhafazat) capital
-I ?4?i- Standard-gage railroad
Narrow-gage railroad
Surfaced road
Unsurfaced road
Airfield
Major port
Populated places
eja Over 100,000
? 50,000 to 100,000
o 10,000 to 50,000
? Under 10,000
Spot elevations in feet
Scale 1:404,000
Statute Miles
5
.... 10.
Kilometers
An
NOS cal
BEIRUT
POPULATION
Based on 1964 census data
Persons per square mile
0 /30
260
390
650
0 50
/00
/50
250
Persons per square kilometer
Shikka
Al Batrun
Jubayl
Palestinian refugee camp
? Kasha
*669 - JR)! r1 Da - I
()Balabak
.""..8117.
Ma 11-
al Bash
34 ?OW?
ECONOMIC ACTIVITY
,?Bayt Shat;ab
..Bikfayya
Textiles
Cement
ilk Oil refining
a Food processing
--- Oil pipeline
INTENSIVE COMMERCIAL CROPS
'Abb yet
I I
Olives
Figs
El Tobacco
Grapes
FROM DHAHRAN. SAUDI ARABIA
eSirghilya
ayr al
Qam
fvfa'asir -
ash Shaf
Kifrayya
.,,?Ma'arrat
aydny?
FROM KA RATCHUS FIELD. SYRIA
AGRICULTURAL LAND USE
asCoastal plain; citrus fruits and
bananas
Highland slopes; grapes,
1.11 olives, figs, mixed with
grain and feed craps
Highlands; deciduous fruits
with grapes, figs, vegetables,
and grains in high valleys
Truck crops; grapes, sugar
beets, grain and feed crops?
predominantly irrigated
VEGETATION
fl Crops predominant; small
areas of grass or scrub
Forest and scrub; small areas
of crops in valleys, on slopes
and terraces
Sparse vegetation of grass and
low shrubs or barren ground
BUh:A YEsire-
AL QIR'AWN
?Al tli?a
Al K'swah
.Zakiyah
.Bayt Jinn
"Jubblita' as Zayf
Thaliajiratal
Hijcinah
Al Qunaytirah-11-'
35'30
BOUNDARY REPRESENTATION IS
NOT NECESSARILY AUTHORITATIVE6?30'
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
25X1
Secret
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9
Secret
Approved For Release 2002/05/16 : CIA-RDP79-00891A001000030001-9