As part of the 3RF financing strategy, the Lebanon Financing Facility is a multi-donor trust fund established by the World Bank, in close cooperation with the United Nations and the European Union and with support from key donors.
The objective of the Lebanon Financing Facility is to kick-start the immediate socio-economic recovery of vulnerable populations and businesses affected by the Port of Beirut explosion. It pools grant resources and strengthens financing, while supporting selected 3RF priorities.
As part of its focus on 3RF recovery and reforms tracks, the Lebanon Financing Facility aims to support the Government of Lebanon in the implementation of reforms and to prepare for medium-term recovery and reconstruction.
Formally established on December 18, 2020, the Lebanon Financing Facility will have an initial duration of 5 years. It seeks to raise US$75-US$100 million in its first year and reach up to US$200 million in its second year. To date, the Lebanon Financing Facility has received contributions and pledges from the governments of Canada, Denmark, France, Germany, Italy and Norway and from the European Union.
PRIORITIES AND IMPLEMENTATION MODALITIES
The Lebanon Financing Facility prioritizes its activities under three focus areas:
- SOCIOECONOMIC AND BUSINESS RECOVERY: Addressing urgent recovery priorities of vulnerable communities and businesses in Beirut.
- REFORM AND RECONSTRUCTION: Supporting the design and implementation of targeted reforms in governance, business environment and the social sector, in order to build citizen trust in state institutions.
- COORDINATION, MONITORING, ACCOUNTABILITY AND OVERSIGHT: Strengthening institutional capabilities to facilitate and monitor 3RF’s multi-stakeholder dialogue.
- The Lebanon Financing Facility adopts innovative and flexible implementation modalities. It seeks to provide direct support to capable non-government organizations and civil society organizations as well as to private sector intermediaries to reach affected micro-, small- and medium-sized enterprises.
THE BUILDING BEIRUT BUSINESSES BACK AND BETTER (B5) FUND
It is the first project to be implemented under the Lebanon Financing Facility.
This US$25 million grant will support the recovery of approximately 4,300 micro and small enterprises directly affected by the Port of Beirut blast and sustain the operations of up to 5 microfinance institutions. It will also help preserve private sector jobs and reduce business closure and layoffs.
Implemented by Kafalat SAL, the B5 Fund is designed to disburse in a transparent and timely manner, directly through specialized and tested institutions. Kafalat and the World Bank signed the B5 Fund grant agreement on August 5, 2021 and project activities were officially launched on November 11, 2021.
SUPPORT FOR SOCIAL RECOVERY NEEDS OF VULNERABLE GROUPS IN BEIRUT PROJECT
This US$7.8 million project addresses the immediate social recovery needs of vulnerable groups who remain impacted by the Port of Beirut explosion. Project beneficiaries include survivors of gender-based violence, individuals suffering from deteriorated psycho-social wellbeing, and persons with disabilities and older persons facing difficulties in accessing appropriate care due to their disabled or elderly status, as well as migrants and refugees working as domestic workers in Beirut. The project is implemented by the International Rescue Committee (IRC). It pilots an effective, inclusive and sustainable model for non-government support with grants provided directly to a select number of NGOs to provide social services to vulnerable groups affected by the crises in the immediate-to short-term.
THE BEIRUT HOUSING RECONSTRUCTION AND CULTURAL AND CREATIVE INDUSTRIES RECOVERY PROJECT
This US$12.75 million project prioritizes complex, climate-resilient repairs of severely damaged residential heritage buildings located in neighborhoods within 5 km of the epicenter of the blast. Repairs will particularly focus on a subset of vacant damaged residential buildings that were inhabited by lower-income and vulnerable households with low tenure security, thus facilitating the return of displaced households to their homes. Buildings to be rehabilitated will be identified based on four prioritization criteria: geographic scope, level of damage, socio-economic vulnerability, and heritage value. The project will also provide technical assistance and grants to affected cultural entities and practitioners, prioritizing women and women-led entities, operating in targeted cultural and creative industries to provide them with incentives to continue cultural production in neighborhoods affected by the explosion. The project is implemented by UN-Habitat in close collaboration with local authorities and other governments entities, and in consultation with a large body of CSOs, NGOs, and academia. Grants to cultural and creative entities will be approved by a Grant Approval Committee comprised of representatives of government and local cultural entities and chaired by UNESCO.
THE BEIRUT CRITICAL ENVIRONMENT RECOVERY, RESTORATION AND WASTE MANAGEMENT PROGRAM
This US$10 million program will help manage and dispose of asbestos-contaminated demolition waste generated from the damaged buildings, rehabilitate damaged solid waste infrastructure and provide technical assistance for their sustainable operation. The project will rehabilitate two damaged solid waste treatment facilities – the Karantina solid waste sorting facility and Coral composting facility. It will also support the improvement of the overall waste management system in Beirut through the implementation of demonstration pilots on integrated solid waste management, including the sorting, collection, transportation and disposal of solid waste, in selected areas impacted by the explosion. Local communities will be engaged in the selection of these pilots, the design of treatment approaches and the evaluation of their performance.
GOVERNANCE AND TRANSPARENCY
A partnership Council guides and monitors the implementation of the Lebanon Financing Facility. The Partnership Council’s responsibilities include ensuring alignment of financing with 3RF priorities, guiding trust fund priorities, endorsing annual work plans and budgets, and reviewing progress.
The Lebanon Financing Facility’s Partnership Council is co-chaired by the World Bank Country Director and a senior-level representative from the European Union. Members of the Lebanon Financing Facility’s Partnership Council include: the United Nations Resident and Humanitarian Coordinator (as observer); all Lebanon Financing Facility’s donors with a minimum contribution of US$5 million; Government representatives; and civil society organizations/non-governmental organizations/private sector representatives (on a rotating basis) as observers.
LEBANON FINANCING FACILITY FINANCING AND DONORS
Target Umbrella/Multi-Donor Trust Fund (MDTF) Donors: Canada, Denmark, European Union, France, Germany, Italy, Norway, Sweden, United Kingdom.
Total funding raised (as of end March 2023) amounts to approximately US$70 million. Details are included in the table below:
Check the Lebanon Financing Facility – Trust Fund Annual Progress Report 2022
Check the Lebanon Financing Facility – Trust Fund Annual Progress Report 2021