7Jan

ONE YEAR LATER: Entrepreneurship In Exile Insights into Syrian Refugees Startups – Lebanon

A year ago, I published the Entrepreneurship in Exile study was published to focuses on Syrian entrepreneurs who were forced to leave Syria and become immigrants and refugees in host countries. Built on data from a study examining Syrian entrepreneurs’ views and experiences over 12 months of research, during which 156 interviews were conducted and ten open discussions as well as a series of interviews with entrepreneurial experts. Year after, I wanted to do a revisit on the report and examine the main challenges that faced the entrepreneurs and see what this year has reflected on the Syrian refugees in Lebanon.

Read the full study

Lebanon has a long history of protracted economic crises. The country of 10,452 square kilometers has a population of nearly 6.5 million people, including almost one million Syrian refugees. The long-standing gap Solutions have indeed been put forward by successive governments, but they have done little to bridge that gap in the market. Lebanon needs to create six times more jobs than it currently does to accommodate the 23,000 people who join the waiting list every year. 1

The influx of over a million Syrian refugees in the wake of the “Syria Crisis” has placed a further strain on the labor market. Competition for jobs increased, driving down wages and causing black and informal markets to thrive. Restrictions by the government have meant to limit the jobs that Syrian refugees can do, but law enforcement is still lax.

At the end of 2018, the Lebanese governments sought to stem the expansion of the informal labor market by a decision from the ministry of labor to set out a list of occupations and roles which should be occupied by Lebanese workers only. By default, senior roles (deans, managers, presidents) in public and private institutions such as universities, hospitals, syndicates, and engineering companies are usually filled by Lebanese nationals. Those changes were followed, in July 2019, by a decision (84/1) issued by the ministry of labor concerning annual work permits for Syrian refugees. The order sought to “regulate the status of Syrian workers” in the Lebanese job market.

The decision coincided with a national campaign by the labor ministry has seen a nation-wide crackdown on businesses that are owned by Syrian refugees or hire refugee workers without a work permit. This has left thousands of refugees – including Palestinian refugees – with limited opportunities and put more numbers out of the job market. Recent data has revealed that the proportion of MSMEs in Lebanon is enormous. Up to 95 percent of companies in Lebanon are defined as either micro or medium enterprises. 2 Interestingly, a small percentage of those businesses are technology-based. How many of those businesses are Syrian is not known, although for Syrians to register a business, their ownership share has to be less than 50 percent.

Forty-seven percent of working-age Syrian refugees in Lebanon are working in some capacity, primarily in agriculture, domestic services, and construction—three sectors that the government has opened for Syrian employees. Syrians are also establishing micro- and small enterprises in informal sectors or are working with local partners. 3

On the other side, the Lebanese NGOs, with the partnership with the private sector and international organizations, have priorities the refugee’s startup support with their activities in the country by hosting training programs, local startup competitions, and by supporting the integration of businesses from both the local and refugee communities. Before the end of the year, the startup ecosystem at large, including the refugee’s support programs, experienced a setback due to the Lebanese uprising 2019 in the middle of October.

All of which has caused changes in the challenges that are facing the Syrian refugee’s startups in Lebanon, where challenges such as Travel Restrictions, Social Exclusion, Banking & Financial Services Limitations all have become more harder. See the graph below for the full list of challenges changes between 2018 and 2019.

THE AVERAGE TOP REFUGEES’ STARTUP CHALLENGES IN LEBANON ON BOTH 2018 AND 2019
ENTREPRENEURSHIP IN EXILE

 

One of the starkest grievances, widely pronounced on the street, was lack of job opportunities, particularly amongst the youth. University and even school students went on strike in protest against the disproportionate numbers of youth unemployment and accused the government of doing little to fix to generate more opportunities for the thousands who graduate every year. For those, the only option is to seek a career abroad. Allowing Syrian refugees to open businesses in the local market could provide an additional boost to the economy and open new job opportunities.

 

Reference:

1) Unemployment In Lebanon, Findings And Recommendations

2) Lebanon SME Strategy: A Roadmap To 2020 

3) UNDP, Jobs Make the Difference Report – 2017

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