Building Beirut Businesses Back and Better (B5) Fund supports small businesses impacted by the Port of Beirut explosion
Close to 1,400 micro and small enterprises received grants
What brings together Hussein, Tsolyn, Charbel and Mohamed? They all own small business that have been severely impacted by the Port of Beirut Explosion on August 4, 2020. And they have all benefited from a grant from the Building Beirut Businesses Back and Better Fund or the B5 Fund.
Funded by the Lebanon Financing Facility (LFF) and launched in November 2021, the B5 Fund aims to support the recovery of micro and small enterprises (MSEs) directly affected by the blast and sustain the operations of eligible microfinance institutions (MFIs). It will also help preserve private sector jobs and reduce business closure and layoffs. The blast caused substantial physical damage and loss of stock and inventory to approximately 10,000 privately owned businesses located within a 5 km radius of the explosion site. It significantly affected firms’ productivity and revenue generation and lead to substantial layoffs and bankruptcies. A World Bank rapid businesses survey conducted during November and December 2020, showed that around:
- 17% of businesses were confirmed or assumed to be permanently closed;
- 79% of businesses experienced reduced sales (on average, a 69% decline);
- and 61% of businesses had decreased the number of permanent workers by 43% on average.
So far, the B5 Fund has provided grants to approximately 1,400 MSMEs. The grants helped them cover expenses related to working capital, technical services, equipment and repairs.
Around 30% of the selected MSMEs are women-owned or led. Efforts were also made to identify and support entrepreneurs and businesses who directly or indirectly suffered from a disability as a result of the blast.
“When the government was absent and there was no one I could turn to, the support provided helped me stand on my feet and restart my activity”, said Tsolyn Seukunian, owner of a beauty center in Achrafieh.
The B5 Fund follows a zoning approach whereby eligible beneficiaries are prioritized based on their proximity to the explosion site. It also adopts a simple design that permits the deployment of grants in a transparent, timely and cost-efficient manner to businesses, particularly vulnerable ones directly through specialized institutions. Disbursement to grantees is conditional on the completion of a screening to confirm their damage status based on initial assessments conducted by the Lebanese Armed Forces directly following the blast and to ensure that the same expense is not financed more than once from different sources.
“Not only was I impacted in my livelihoods, but I was also affected psychologically. Thanks to the grant, I was able to repair and reopen my shop”, said Hussein, owner of mini-market in the vicinity of the Port.
Kafalat SAL is implementing the B5 Fund. Kafalat responsibility covers the overall implementation, management, selection of MFIs, monitoring and evaluation, with functions, staffing and responsibilities satisfactory to the World Bank and to LFF donors.