A loser is someone is someone — individual or group — who cannot build snowmobiles when facing uncertainty and unpredictable change;
A winner is someone — individual or group — who can build snowmobiles, and employ them in an appropriate fashion, when facing uncertainty and unpredictable change.-Col. John Boyd
There are a couple of factors going on in Lebanon that are driving the security market there. One is the situation in Syria and the other is a massive gas field off of the coast.
With Syria, you see a lot of spill over across the borders that include refugees or combatants. As Syria continues to fall and morph into a massive jihadist playground, it’s neighbors will suffer. This surge of militant fighters streaming into Syria all have agendas and all are looking to cause chaos amongst their various enemies in the region. Sunni versus Shia, devout islamists versus infidels, etc.. Lebanon, will be impacted, and security in all of it’s forms is what the people will demand and seek if the state cannot provide it. Here is a quote about this reality.
The A to Z Group, a security company offering guard services and cash transfer protection to corporate clients and Lebanese public institutions, hired an additional 100 people about six months ago to meet demand, bringing its total staff to 250 people, General Manager George Ghorayeb told The Daily Star.
“We cover all of Lebanon and I’ve noticed that clients everywhere are afraid of the situation. The biggest demand is for residential and corporate guards,” he said. “There has been a big increase in buildings requesting services because they are scared.”
Elie Georgiou, the executive manager of PRO.SEC, a Lebanese firm that employs 800 people and offers physical security and close protection services, said business remained stable between 2012 and 2013, but there had been an increase in job seekers.
As for energy, the Levant Basin gas fields and rush of Cyprus and Israel to get in there and tap into it, is causing Lebanon to rethink it’s views on those fields. It wants in on that gold rush. (article posted below)
Competing claims by Israel and Lebanon to about 215,000 acres of potentially mineral-rich maritime territory and increasing instability caused by the Syrian civil war could also complicate the effort.
Lebanon began to tap its onshore oil resources in the 1960s, but the long civil war stopped all development. While the government has known about the resources lying off the Mediterranean coast for decades, the focus did not shift there until 2000. Political infighting, a major war with Israel and long stretches without a government have hampered decision-making since then.
Officials swung into action only recently, after Israel and Cyprus began developing their natural gas reserves in earnest. The Petroleum Administration, responsible for negotiating oil and gas contracts, was supposed to be appointed early last year, but squabbling over representation for the country’s different religious sects delayed the process by months. Ultimately, the six seats were given to men from each of Lebanon’s six largest religious groups.
So with that said, if Lebanon wants to do business with those companies that can extract this resource, it will have to get it’s house in order politically, and provide for the security needs of these companies. Enter the PMSC’s.
The first article I posted below delves into the potential for private security and gives a glimpse into the market of force in Lebanon and here is a quote that grabbed my interest.
This might be poised to change since many of the international firms that thrived off Western military contracts in Iraq and Afghanistan are diversifying operations and looking to new markets, Olver of Kroll said.
“The security industry in general is in crisis, so a lot of international companies are looking for the next big thing or to diversify into the next little five or six things,” Olver said. “A lot of the international oil and gas companies have set up one-man offices in Lebanon since the oil and gas tender round is about to start and a lot of security guys are looking to that sector. They see that the oil companies they already service in Libya are looking at Lebanon, so a lot of them have positioned themselves to be able to provide services in Lebanon.”
Interesting stuff and we will see how it goes? Although the question remains, is turmoil good or bad for the security industry there?
I would say that security contracts pre-Arab Spring were of one type and quantity, but now that the market has changed, that security companies are probably having to adapt to the ‘new’ security requirements that have materialized as an outcome of the Arab Spring. Those companies that can evolve and innovate to meet those new security requirements will stand to survive the changing market. Adapt/evolve/innovate–or die. Or how Boyd would put it, winners are those that can ‘build snowmobiles’. –Matt
Turmoil no clear-cut gain for security firms
August 19, 2013
By Lysandra Ohrstrom
As outbreaks of violence across the country become increasingly routine, one would expect Lebanon’s private security companies to thrive. But the global trends that have reshaped the international private security industry over the past few years and heightened risk aversion on the part of governments and corporations have complicated what would otherwise be a straightforward economic success story. Michael Olver, the director of Kroll’s Middle East business intelligence unit, said Lebanese firms were likely to see sustained or increasing demand for services from their existing stalwart clients like embassies, which typically boost their spending on security when the situation deteriorates in order to maintain operations.
At the same time, they will probably see a reduction in the number of multinational corporate clients, he said.
“Large international private sector firms are already evaluating the risk-return balance for having large offices in Lebanon and are going to be re-evaluating the need for a continued large-scale presence,” he told the Daily Star.
Kroll, which provides personal protection to high-level executive clients visiting Lebanon in addition to its business advisory and fraud investigation services, has already seen GCC nationals scale back travel to the country due the bans many Gulf countries have imposed.