The United States has increased its assistance to war-battered Lebanon to $95 million as part of what will have to be a "very, very large" international effort to help rehabilitate the country from the Israeli invasion, a senior U.S. government official said today.
Peter McPherson, director of the U.S. Agency for International Development (AID), told a press conference in East Beirut that he was confident the country would recover from the effects of the massive Israeli air, sea and artillery bombardment and years of civil war destruction.
He announced the United States would provide $30 million in loan guarantees to assist private redevelopment efforts. The guarantees reduce interest rates on the loans.
McPherson said he was confident that Congress would approve $50 million in aid requested previously by President Reagan. Another $15 million in emergency relief assistance is also being provided under earlier plans.
Muhammad Atallah, chairman of Lebanon's Council for Development and Reconstruction, said in an interview today that the country would require about $24 billion to revive from the effects of war, about evenly divided between the government and the private sector. Lebanon's gross national product is about $6 billion.
He expected about 75 percent of the government funds to come from foreign assistance, much of it from Arab oil-producing countries which are Lebanon's traditional customers for services such as banking, insurance and shipping.
Seven oil-producing countries pledged $2 billion in 1979 but the fund never got off the ground because of the continuing civil war and later Israeli attacks.
Both the U.S. and Lebanese officials expressed confidence, however, that Lebanon would bounce back.
McPherson, on his second visit to the country in two months, said, "Lebanon has an enormous amount going for it. The facts are this is a vibrant economy that will respond well with political stability."
"The Lebanese government needs to take the lead," he said, and added that after meetings with officials, including President-elect Bashir Gemayel, he was convinced the regime would do so.
Atallah noted that any deterioration in the security situation would deal a serious blow to redevelopment, which he estimated could take five to eight years. There are fears that Israeli forces may clash again with Syrian or Palestinian troops in the eastern or northern parts of the country once the evacuation of the Palestine Liberation Organization from Beirut is completed this week.
"Although Lebanon's face is so mutilated, it has not lost any of its characteristics," including being a center of commerce, banking and services for the Middle East, he said.
As an illustration of the gravity of Beirut's problems, he said it costs about $20 million to put up a single 12-story building. Municipal officials estimate that the Israeli bombardment destroyed or heavily damaged about 25 percent of the buildings in West Beirut, which has most of the modern structures and suffered the greatest damage.
McPherson has not toured West Beirut during his two visits, nor have other AID officials. Apparently for security reasons, Defense Secretary Caspar Weinberger is not scheduled to set foot there during his brief visit tomorrow.
Immediate needs for disaster relief are largely being met, McPherson said, but "shelter will need to be provided for about 60,000 people before the fall rain.
"The question of rehabilitation, however, is another matter, both in West Beirut and in the south. The extent of devastation in West Beirut is clearly very great," he said, and added that an "on-the-ground assessment is required" to determine the necessary response. He said AID officials would visit West Beirut "shortly."
He estimated that 300,000 people are receiving relief assistance in the country, almost 10 percent of the population. The figure, however, was down from earlier Red Cross estimates of 600,000 refugees.
Atallah pointed out that, economically, many citizens were faring better than the government. There are almost twice as many Lebanese outside the country as the 3 million inside and it is estimated that in normal times they remit about $100 million a month in foreign exchange to their relatives. In the current crisis the amount could double.
Thus the country had a record $1.1 billion balance of payments surplus last year but government tax revenues are down sharply because the war has stymied production and commerce. Meanwhile, the requirements for aid to the needy have burgeoned because of the war.