Donors meet in Sweden to raise funds for Lebanon

Stockholm, Aug 31: Lebanon's Prime Minister told international donors gathered in Sweden's capital his country urgently needed funds to rebuild battered infrastructure and help hundreds of thousands displaced by Israeli bombing.

Fouad Siniora told representatives of some 60 governments and organisations hoping to raise an initial 500 million dollars that Lebanon's economy had gone from recovery to ''deep recession''.

''Lebanon, which only seven weeks ago was full of hope and promise, has been torn to shreds by destruction, displacement, dispossession, desolation, and death,'' he told the conference.

''The direct damage from this last invasion to our infrastructure and to our public and private property is now running into the billions of dollars,'' he said, adding the broader economic damage was worth billions more.

The European Union has already pledged 54 million dollars for short-term recovery work like clearing unexploded bombs and rebuilding ruined homes and roads.

The Stockholm conference aims to buttress this with another 500 million dollars, although Sweden's Foreign Minister Jan Eliasson told Reuters the meeting may raise even more.

''This conference is not only about money, it is also sending a signal to Lebanon that Lebanon has full control,'' he added.

Beyond the short term, Lebanese officials say they will need billions more and hope to hold a bigger conference in Beirut.

HIZBOLLAH

Western worries are growing that cash handouts from Hizbollah to those whose homes were destroyed or damaged in the 34-day war with Israel will entrench the guerrillas' popularity.

Yesterday, Siniora said his government would pay 40,000 dollars to each family made homeless so they can rebuild.

Asked whether Hizbollah would be involved in distributing the funds, Eliasson said it was up to the Lebanese government to discuss and decide that. ''What we need right now is to get the reconstruction process started,'' he said.

Siniora told the senior diplomats, government officials and representatives of aid organisations attending the conference that if Israel did not withdraw from all its positions in Lebanon, it would undermine recovery efforts.

The money raised in Stockholm will go toward sheltering 30,000 homeless families in prefabricated units, removing unexploded bombs and restoring electricity and water supplies.

Lebanon plans to earmark 52 million dollars for further work on clearing an oil slick that has spread along its coast since the bombing of the Jiyyeh power station last month.

According to UN and Lebanese estimates, Israeli strikes on the plant's fuel storage tanks spilled an estimated 10,000 to 15,000 tonnes of heavy fuel oil into the Mediterranean Sea.

Israel began a bombardment of Lebanon after Hizbollah guerrillas captured two Israeli soldiers in a cross-border raid. The war killed nearly 1,200 people in Lebanon, mainly civilians, and 157 Israelis, mostly soldiers.

REUTERS