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July 23, 2020 | English | Sami Atallah, Ishac Diwan, Jamal Ibrahim Haidar, and Wassim Maktabi
Public Resource Allocation in Lebanon: How Uncompetitive is CDR’s Procurement Process?

Lebanon is facing unprecedented intertwined crises: Its banking sector is largely insolvent, its currency has significantly depreciated, and its debt is unsustainable. Lurking behind this is the country’s ailing and neglected infrastructure, which is essential to kick-start economic growth. 
Successive governments have invested too little in the country’s public assets, and the public funds allocated for capital investment have been mismanaged for years. For this article, we examined the allocation of projects contracted between 2008 and 2018 by the Council of Development and Reconstruction (CDR).

Here is what we found:

- A full 60% of total CDR spending ($1.9 billion) was granted to only 10 companies, and two firms alone accounted for 23% of total CDR spending, casting doubts on the level of fairness and competitiveness in the procurement and tendering processes.

- The quasi-monopoly of public resources is also observed at the governorate and district levels, as few firms received privileged treatment over CDR project funding

- In light of the resurfacing talks on the CEDRE conference, there is an urgent need to make the tendering and procurement processes more competitive in order to ameliorate the quality of infrastructure.