Beirut, February 11, 2023 – A first shipment of 33,000 tons of wheat, financed under the Lebanon Wheat Supply Emergency Project, has arrived at the Port of Beirut and started being discharged. The shipment -equivalent to about one month-worth of Arabic bread consumption in the country- will help rebuild Lebanon’s wheat stock and secure affordable bread for poor and vulnerable households. This first shipment will be followed by several additional shipments of varying sizes over the following months, to ensure continuity of wheat supply and maintain access to affordable bread throughout the lifespan of the project.
Approved in May 2022, in response to the global market disruptions caused by the war in Ukraine, the US$150 million project aims to ensure the availability of wheat in Lebanon. Lebanon imports nearly 80% of the wheat it consumes, and, historically, the quasi totality of these imports have come from Ukraine and Russia (respectively 80% and 16% in 2020). The war in Ukraine came at a time when Lebanon had been grappling with an acute economic and financial crisis, an increase in unemployment, a rise in poverty and vulnerability and a surge in inflation, particularly food inflation, which primarily affects poorer households among host communities and refugees. These negative macroeconomic trends are forecast to continue into 2023. Following the Port of Beirut explosion and the destruction of the Port silos that have severely reduced the domestic storage capacity, wheat imports have been handled in a just-in-time fashion.
“Bread is an essential staple in the poorest people’s diet. Any disruption of the wheat value chain will primarily impact poor and vulnerable host communities and refugees,” said Jean-Christophe Carret, World Bank Mashreq Country Director. “This project responds to the needs of people in Lebanon severely affected by the impact of compounded crises the country is facing. It complements the ongoing World Bank financed Emergency Social Safety Net Project”.
The project has multiple layers of mitigation measures in place to ensure efficient and transparent implementation of activities under World Bank supervision. These include a competitive process to purchase wheat, with close attention to market developments and price analysis through a technical cooperation between the World Bank and FAO, third-party monitoring of the wheat, flour and bread distribution and consumption throughout the value chain, strong focus on full compliance with the World Bank’s fiduciary, safeguards, and anti-corruption policies, as well as the public disclosure of the wheat purchase contract awards and future project results.
“We promised the Lebanese people to protect their bread and we delivered proudly and successfully, thanks to our partner the World Bank. The loan will provide great relief through stability in wheat availability and bread prices in Lebanon during the country’s most challenging times,” said H.E. Amin Salam, Minister of Economy and Trade.
While addressing the urgent food security needs in the immediate term, the project is also helping develop the framework for reforms in wheat sector policy and governance, including storage solutions and local production potential, with the longer-term goal of putting the wheat sector on a pathway toward recovery and greater resilience.
The Wheat Supply Emergency Response Project includes a US$15 million grant from the Global Concessional Financing Facility (GCFF), a fund created in 2016 to provide concessional financing to middle income countries hosting large numbers of refugees considering the global public good they are providing.