In reference with the havoc damages resulting from the Beirut Port Explosion, the Lebanon Financing Facility (LFF), which is a multi-donor trust fund formed by the World Bank in December 2020, will be financing the Building Beirut Businesses Back and Better Fund (B5 Fund).
B5 fund program will grant an amount of $ 25 M to support the recovery of selected micro and small enterprises (MSEs) severely impacted by the blast. In turn, this assistance will preserve jobs, and prevent further business shutdowns and layoffs.
According to the World Bank rapid firm-level survey, approximately 17% of firms were confirmed or assumed to be permanently closed, 79% of businesses experienced reduction in their sales figures, and 61% had a drop in their number of workers by 43% on average. Moreover, the survey declared that 46% of surveyed firms have been impacted by the blast either directly or indirectly and were struggling to pay for their reconstruction and recovery process.
In more details, the B5 fund will support almost 4,300 MSEs to cover expenses linked to working capital, technical services, equipment, and repairs. About 30% of the MSEs selected will be women-owned as well as entrepreneurs who suffer from a disability caused by the explosion. Moreover, the fund will also provide assistance for operational expenses for up to 5 MFIs serving micro and small firms and low income populations.
The fund will be implemented by Kafalat SAL which will be responsible for the overall management, selection of intermediaries, monitoring and evaluation with functions and staffing satisfactory to the World Bank and LFF donors. In this context, the Fund will embrace a zoning approach to prioritized eligibility based on their proximity to the explosion site. It will adopt a simple design to, timely and cost-efficiently, place the grants. In addition, granting will be restricted under the condition of the accomplishment of a screening by MFIs and Kafalat to confirm damage status based on first assessments done by the Lebanese Armed forces following the blast in order to ensure that expenses are not funded more than once from different sources.
Moreover, the LFF independent oversight body will closely monitor the activity of fund. In addition to the TPMA a third party monitoring agent that will be independently verifying the compliance of the process, assessment and use of funds with the project operations manual.
While the international community is addressing the socio-economic reform needs of the Lebanese and more donors are supporting the B5 Fund, yet these contributions may not be enough to pave the way for the country to be pulled out from its most severe economic and financial crises. These require a big recovery and restructuring program that the new Government has yet to consider.