[Originally posted at NOW]
Calls for regulating and taxing Lebanon’s thriving cannabis and sex trades may make economic sense, but face myriad sources of opposition.
An old and patronizing cliché has it that Lebanon is the “Switzerland of the East,” but writers in search of an easy phrase may soon update that to something more like the “Amsterdam” of the region if an unusual new proposal from one former minister is ever taken up.
In a controversial suggestion to boost Lebanon’s strained and ailing state revenues, which are currently under scrutiny following renewed demands from public sector workers for long-awaited raises, former Tourism Minister Fadi Abboud has called for legalizing – and taxing – the country’s reputedly substantial cannabis and prostitution industries. These steps – just two out of a total of twenty-five proposed by Abboud – would not only raise considerable revenues but also undercut organized crime, he argues.
“We are simply trying to remove the pimp from prostitution […] and make a bit of money for the government,” Abboud told NOW, clarifying that he only endorsed legalizing the cultivation and export of cannabis, not its domestic consumption. Though he initially estimated the potential state revenues from prostitution alone to be “in the region of $50-60m,” he later said it was “very difficult to say” exactly how much might be raised in total.
Economists agreed, telling NOW no concrete data were available on the matters, though there is little doubt both are thriving and lucrative businesses in Lebanon.
“I have no idea [how much money could be raised] to tell you the truth, and I have never tried to estimate that, but probably these are two recession-proof sectors,” said Nassib Ghobril, chief economist at Byblos Bank, with a laugh. Dr. Jad Chaaban, professor of economics at the American University of Beirut, told NOW he knew of no reliable estimates of the industries’ monetary values.
NOW’s own estimate, calculated using data from twelve media reports on Lebanon’s hashish trade, is that annual income to local farmers from the crop likely ranges from $30-80m, depending on the area cultivated and the market price, both of which fluctuate for various reasons. The dealers to whom farmers then sell, however, are believed to make between four and ten times that much, putting the total value of the industry at anywhere between $120m and $800m per annum (approximately 0.3%-1.8% of GDP). Other unofficial estimates have put the figure at $875m. To these should be added an estimated $140m generated by the sex trade, amounting to a potential combined total of nearly $1bn available for taxation – not a trivial sum, compared with the roughly $1.6bn required to fund the public sector wage increase.
More contentious than the economics, however, is Abboud’s defense of his proposals on humanitarian grounds. Describing the so-called “super nightclubs” that he says function as de facto brothels across the country, Abboud told NOW “the system is inhumane. We break every single law in the world of human rights. [The women] are nearly imprisoned. They are locked in hotels with steel doors. Even fire exits in these ‘super nightclubs’ are locked” to prevent their escape. “These women should have rights” – rights, he says, which would be guaranteed if the business were regulated by the state.
Some human rights activists take a different view, though.
“When you legalize prostitution, you are acknowledging that women are for sale,” said Maya al-Ammar, spokesperson for KAFA, an NGO focusing on violence against and exploitation of women. “[Abboud] actually reinforced the objectification and commodification of women’s bodies […] Even if he framed it in a humanitarian [way,] he’s still saying I want to regulate it because I want to fund something.”
Moreover, legalization seldom leads to improvements in prostitutes’ welfare anyway, Ammar argued.
“Even in the countries where prostitution was regulated, women were not protected […] Legal or illegal, it never stops being or happening underground. So it doesn’t really solve the problem.”
And while KAFA does not advocate the criminalization of prostitution per se – “You don’t criminalize the women, you criminalize the industry that is exploiting them,” said Ammar – it believes working to eradicate its root causes is the far preferable approach to full legalization.
“It’s better to invest in designing strategies, exit programs, support programs, fighting poverty […] and trafficking […] than to think of how we can take advantage of these women,” she told NOW.
Moral questions aside, Abboud’s proposals are unlikely to come to fruition any time soon, as he himself admits.
“The establishment, political and non-political, are benefiting” from the status quo, Abboud told NOW, alleging widespread bribery of officials by those managing the illicit trades.
Prof. Chaaban agrees. “You’re not only fighting organized crime, you’re also fighting habits, you [need a] rigorous policing system, it’s something beyond any foreseeable implementation scenario” he told NOW.
“I’m for legalizing, but I don’t think it can be done now in Lebanon.”
Calls for regulating and taxing Lebanon’s thriving cannabis and sex trades may make economic sense, but face myriad sources of opposition.
An old and patronizing cliché has it that Lebanon is the “Switzerland of the East,” but writers in search of an easy phrase may soon update that to something more like the “Amsterdam” of the region if an unusual new proposal from one former minister is ever taken up.
In a controversial suggestion to boost Lebanon’s strained and ailing state revenues, which are currently under scrutiny following renewed demands from public sector workers for long-awaited raises, former Tourism Minister Fadi Abboud has called for legalizing – and taxing – the country’s reputedly substantial cannabis and prostitution industries. These steps – just two out of a total of twenty-five proposed by Abboud – would not only raise considerable revenues but also undercut organized crime, he argues.
“We are simply trying to remove the pimp from prostitution […] and make a bit of money for the government,” Abboud told NOW, clarifying that he only endorsed legalizing the cultivation and export of cannabis, not its domestic consumption. Though he initially estimated the potential state revenues from prostitution alone to be “in the region of $50-60m,” he later said it was “very difficult to say” exactly how much might be raised in total.
Economists agreed, telling NOW no concrete data were available on the matters, though there is little doubt both are thriving and lucrative businesses in Lebanon.
“I have no idea [how much money could be raised] to tell you the truth, and I have never tried to estimate that, but probably these are two recession-proof sectors,” said Nassib Ghobril, chief economist at Byblos Bank, with a laugh. Dr. Jad Chaaban, professor of economics at the American University of Beirut, told NOW he knew of no reliable estimates of the industries’ monetary values.
NOW’s own estimate, calculated using data from twelve media reports on Lebanon’s hashish trade, is that annual income to local farmers from the crop likely ranges from $30-80m, depending on the area cultivated and the market price, both of which fluctuate for various reasons. The dealers to whom farmers then sell, however, are believed to make between four and ten times that much, putting the total value of the industry at anywhere between $120m and $800m per annum (approximately 0.3%-1.8% of GDP). Other unofficial estimates have put the figure at $875m. To these should be added an estimated $140m generated by the sex trade, amounting to a potential combined total of nearly $1bn available for taxation – not a trivial sum, compared with the roughly $1.6bn required to fund the public sector wage increase.
More contentious than the economics, however, is Abboud’s defense of his proposals on humanitarian grounds. Describing the so-called “super nightclubs” that he says function as de facto brothels across the country, Abboud told NOW “the system is inhumane. We break every single law in the world of human rights. [The women] are nearly imprisoned. They are locked in hotels with steel doors. Even fire exits in these ‘super nightclubs’ are locked” to prevent their escape. “These women should have rights” – rights, he says, which would be guaranteed if the business were regulated by the state.
Some human rights activists take a different view, though.
“When you legalize prostitution, you are acknowledging that women are for sale,” said Maya al-Ammar, spokesperson for KAFA, an NGO focusing on violence against and exploitation of women. “[Abboud] actually reinforced the objectification and commodification of women’s bodies […] Even if he framed it in a humanitarian [way,] he’s still saying I want to regulate it because I want to fund something.”
Moreover, legalization seldom leads to improvements in prostitutes’ welfare anyway, Ammar argued.
“Even in the countries where prostitution was regulated, women were not protected […] Legal or illegal, it never stops being or happening underground. So it doesn’t really solve the problem.”
And while KAFA does not advocate the criminalization of prostitution per se – “You don’t criminalize the women, you criminalize the industry that is exploiting them,” said Ammar – it believes working to eradicate its root causes is the far preferable approach to full legalization.
“It’s better to invest in designing strategies, exit programs, support programs, fighting poverty […] and trafficking […] than to think of how we can take advantage of these women,” she told NOW.
Moral questions aside, Abboud’s proposals are unlikely to come to fruition any time soon, as he himself admits.
“The establishment, political and non-political, are benefiting” from the status quo, Abboud told NOW, alleging widespread bribery of officials by those managing the illicit trades.
Prof. Chaaban agrees. “You’re not only fighting organized crime, you’re also fighting habits, you [need a] rigorous policing system, it’s something beyond any foreseeable implementation scenario” he told NOW.
“I’m for legalizing, but I don’t think it can be done now in Lebanon.”
