How Legalizing Marijuana Could Transform Lebanon’s Economy
The town of Brital, located in Lebanon’s Bekaa Valley, is a notably poor area. Aside from occasional displays of wealth by a handful of affluent residents, the town is largely a dusty slum. Stark contrasts are visible as old Eastern European vans and donkey carts travel battered roads past luxurious, yet unwashed, Bentleys and Range Rovers parked outside sprawling mansions. While a few grand homes owned by local underground business leaders rise above the modest buildings, most residents live in deep poverty.
As expected, the local elite who own these impressive palaces have not acquired their wealth entirely legally. These “kings” have risen to power through the underground production and export of marijuana. The fields are located just outside the town, and the plantations are regularly patrolled by armed mercenaries who catch thieves and keep an eye out for government officials—who usually prefer not to interfere in this self-governing region. However, it’s likely that the Lebanese authorities will soon turn their attention to the valley, as it is a promising center for a future legal marijuana market. Regulating the market under Lebanese law would allow the government to break the power of local “marijuana barons,” bring such regions back under state control, and provide fairer wages and better living standards for local people.
Currently, Lebanon’s parliament is considering several models for legalizing the production, sale, and consumption of marijuana, aiming to establish export production of therapeutic cannabis and related products to European countries. The government is seriously considering a five-year plan for social and economic reforms proposed by consulting firm McKinsey & Co., which suggests that legal marijuana production could become a new engine for the national economy.
Recently, the Lebanese government has started to consider full legalization of marijuana due to the country’s prolonged economic stagnation. Lebanon also faces a serious public debt problem, ranking third in the world with obligations amounting to 153% of its GDP owed to various public and private creditors. The country’s economic situation worsened significantly during the civil war in neighboring Syria, which caused Lebanon’s real economic growth to drop to just 2% per year and flooded its cities with refugees fleeing the conflict.
Earlier this month, a 1,000-page report from McKinsey was delivered to President Michel Aoun. In addition to recommending the legalization and development of the marijuana industry, the report advised Lebanon to improve public safety to attract tourists, reform banking and financial institutions to draw foreign investment, and direct state resources to subsidize avocado production, which, like marijuana, could become a valuable export.
Of course, the main point of the consultants’ plan is marijuana reform. This idea has been supported by Lebanon’s Finance Minister, Raed Khoury, who believes that creating a legal marijuana market is the fastest and most effective way to boost the national economy. “Lebanon currently produces some of the world’s highest-quality psychoactive marijuana,” Khoury told Bloomberg, noting that in the first full year of legalization, the marijuana market could bring in $1 billion in taxes and fees for the state.
At present, the money goes into the pockets of local “marijuana barons”—powerful clans of underground cultivators who have been growing marijuana in the Bekaa Valley for generations. Given the product’s popularity in the West, these clans have generated enormous wealth over the past century, making them the de facto rulers of the valley, which is cut off from Lebanon’s main population centers by the mountains. In addition to geographic protection, the clans invest heavily in mercenaries and military-grade weapons, allowing them to resist police and army raids.
Surprisingly, Lebanon’s underground business leaders do not oppose the possibility of legalization. On the contrary, the “marijuana barons” openly support reform, seeing it as a way to legitimize their family businesses. “It’s definitely a huge plus. With the support of the underground marijuana producers themselves, the reform can proceed without extra costs to fight the black market,” says Kassim Tlaz, a Brital resident who acts as a mediator between local farming clans and the Lebanese authorities.
Although Kassim himself is not involved in marijuana production or processing, he tells journalists that working with marijuana is the only decently paid job in the remote valley. Since the government has not invested in the region’s economy or infrastructure for the past 40 years, the poor area has effectively become a self-sustaining state, surviving on underground marijuana exports.
Kassim also believes that the ongoing 20-year conflict between local marijuana farmers and government agents, who sometimes conduct raids and purges in the valley, only worsens the region’s social and economic situation. As government forces destroy illegal marijuana crops, depriving locals of their only source of income, many residents have become accustomed to greeting people in uniform with gunfire, often provoking more aggressive responses from authorities and perpetuating a cycle of violence and mistrust.
Currently, Lebanese authorities maintain a database of arrest warrants for various residents of the Bekaa Valley, located in the Baalbek-Hermel province. There are about 42,000 warrants, most related to marijuana production and distribution. Kassim heads a committee of local farmers from different clans, whose goal is to negotiate a full amnesty for all suspected marijuana cultivators and sellers.
“This also explains why our region is so poor: with an arrest warrant, a person cannot leave the province to find work in a big city, as they would be arrested at the first checkpoint. Unfortunately, many people have been charged who never worked with marijuana at all, since the government decided to impose harsh sanctions on any ‘suspicious’ resident,” he explains.
Historical records show that marijuana has been cultivated in the Bekaa Valley since at least the Ottoman occupation (15th–16th centuries). Underground cultivation peaked from 1975 to 1990, during Lebanon’s civil war, when clans smuggled 2,000 tons of marijuana annually from Lebanon’s shores.
The new civil war in neighboring Syria, which borders Baalbek-Hermel, has sparked another boom for local underground growers. Farmers say their profits rose by 50% in just one year after the war began in 2011, as government forces previously tasked with destroying illegal crops were redeployed to guard the country’s borders.
As a result, Lebanon exports $175–200 million worth of marijuana each year, mainly to Europe, America, the Persian Gulf, and North Africa. According to the latest UN report on global drug trafficking, Lebanon has been one of the world’s top exporters of hashish and hash oil for several years.
The press does not yet know the exact details of McKinsey’s proposed plan, but it likely includes certifying farmers and issuing them licenses for legal production. Previously, the farmers’ council led by Kassim proposed a similar plan for full legalization to the Lebanese government.
Of course, it’s important to remember that the cultivating clans often have business and personal conflicts, so licensing such organizations may not be the most practical solution from a law enforcement perspective.
Kassim also notes that at both the local and national level, the reform plan faces opposition from Hezbollah, a conservative Shiite Muslim organization that is not only a political party with broad social influence but also a paramilitary group with resources rivaling the Lebanese army. In short, the authorities are unlikely to challenge Hezbollah’s opposition without resorting to excessive force.
“Hezbollah is against legalization and the associated economic growth because poverty is a source of recruits for their cause,” Kassim claims. “The party is firmly entrenched in parliament, so we’ll have to take their opinion into account, whether we like it or not.”
In May, Lebanon held its first parliamentary elections in nine years, but the country still lacks a government accepted by all ethnic and religious groups. For this reason, supporters of legalization will need to gain the backing of other, often rival and conservative, parties to implement major reforms.
“Historically, any significant reform in Lebanon turns into a ‘political poker game’ among the many ethnic and religious groups in parliament,” says Nassib Ghobri, chief economist at Byblos Bank. “Many parties simply don’t want a popular reform, along with voters’ support, to go to another political group. So local politicians prefer to drag out negotiations in parliament to avoid giving an advantage to either their opponents or temporary allies.”
Given these circumstances, Lebanon is one of the most corrupt countries in the world (ranked 143rd by Transparency International).
Walid Jumblatt, a Lebanese MP and one of the most vocal political supporters of full marijuana legalization, believes that the Lebanese people can handle reform on their own, without advice from Western consultants. “I’m not going to read this useless report. I proposed similar reforms years ago, without asking for millions of dollars to explain to our ‘wise’ administration how legalizing cultivation would benefit our republic’s economic well-being,” he told journalists.
In any case, Jumblatt supports immediate full legalization of marijuana. “In theory, we could quickly organize a legal and regulated marijuana market, which would improve the quality of life and income levels for all Lebanese, especially the impoverished residents of the forgotten Baalbek-Hermel province,” he told reporters.
So far, McKinsey & Co. has not commented on the politician’s sharp remarks.