China makes tracks to invest in Lebanese railway

Officials talks between China and Lebanon to revive the latter's national rail network – connecting Beirut and Tripoli to Syria's Damascus – are the latest example of China’s economic engagement in the Middle East. Youssef Fenianos, Lebanon's public works and transport minister, met with a Chinese delegation in late May to discuss railway construction options.

The revival of the railway, which has been abandoned since the Lebanese civil war (which lasted from 1975 to 1990), would mean quickly built infrastructure with Chinese expertise and – if an agreement is negotiated by Lebanese officials – the creation of thousands of jobs for the local workforce.

Infrastructure investment is expected to play an important role in Lebanon's economic growth. China is increasingly focused on making inroads in the region as part of its Belt and Road Initiative, and the reconstruction of Lebanon's neighbour Syria, which will cost about $200bn according to World Bank estimates. Lebanon is expected to play significant role as a gateway for reconstruction materials, expertise and manpower.

"We are ready to support Lebanon with our technical knowledge. But we are more interested in connecting Beirut to Tripoli, Tripoli to Aleppo, Aleppo to Damascus, and so on," said Eliana Ibrahim, president of the China Arab Association for Promoting Cultural and Commercial Change, via Lebanese newspaper The Daily Star.

The recent lease of a 60,000-square-metre mall in Lebanon's Bekaa valley (with implications for more than 400 Chinese retailers) is another sign of China’s growing interest in the country. 

Lebanon needs $22.9bn to revamp its dilapidated infrastructure, according to the country’s ambitious capital investment programme launched at Cedre, an international development conference for Lebanon held in Paris in April 2018. Cedre saw the international community, in particular the World Bank, pledge $11.6bn to the capital investment plan.

The administration of prime minister Saad Hariri, which formed a government in February 2019, has made increasing FDI a priority and sent positive signals to the investment community that Lebanon is open for investment inflows.