Lebanon

Factual Figures .............................................................................................................. 2

Overview ........................................................................................................................... 2

Tourism .............................................................................................................................. 2

Economy ............................................................................................................................ 3

Financial Sector ............................................................................................................. 3

Insurance Market ......................................................................................................... 4

Agricultural Sector ...................................................................................................... 4

Energy Sector ................................................................................................................. 4

IT Sector ............................................................................................................................ 5

UK-Lebanon Links ........................................................................................................ 5

Useful Contacts

Ministries ............................................................................................................ 5

Embassies ........................................................................................................... 6

Chambers of Commerce ............................................................................. 6

Other Business Links ................................................................................... 7

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Factual Figures

Official Name: Republic of Lebanon Capital: Beirut Land Area: 10,452 km2 Population: 4,143,101 (July 2011 est) Official Language: Arabic with both English and French widely spoken Currency: Lebanese Lira (LL) GDP Growth: 6.9% (2009) Main Industries: Banking, tourism, food processing, wine, jewellery, cement,

textiles, mineral and chemical products, wood and furniture products, oil refining, metal fabricating

Exports: Jewellery, base metals, chemicals, miscellaneous consumer goods, fruit and vegetables, tobacco, construction minerals, electric power machinery and switchgear, textile fibres, paper

Imports: Petroleum products, cars, medicinal products, clothing, meat and live animals, consumer goods, paper, textile fabrics, tobacco, electrical machinery and equipment and chemicals

Overview

Lebanon gained its independence from France in 1943 and developed into one of the Middle East's most advanced economies. It has long been a convergence point of trade routes and meeting place for a wide variety of peoples, which is the basis of the rich and diverse national culture that exists in the country today. It is a regional and international hub for trade, finance, services, industry, culture and tourism. At the centre of the Eastern Mediterranean, Lebanon is at the crossroads of Africa, Asia and Europe. It enjoys a rich variety of climates and ecosystems. As a trading and international banking centre despite its small territory, Lebanon was long known as "the Switzerland of the Middle East" until its disastrous 1975–1990 civil war and protracted conflict which seriously damaged the infrastructure and economic performance. Since the 1990s, successive governments have invested heavily in selected, high-quality infrastructure projects. As a result, Lebanon has a number of good main roads, a large, new international airport and two modern, reliable mobile-phone networks. However, these projects have tended to be focused in and around Beirut, with less activity in outlying areas. Lebanon is still undergoing post-war reconstruction following the 2006 conflict and its long-term growth potential has been constrained by political uncertainties. Tourism

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Tourism, the country’s major economic activity and foreign exchange earner, was hit severely by the recent crises. However, efforts are now being made to reposition Lebanon on the international tourism map. The Ministry of Tourism is continuing with projects to promote Lebanon providing electronic services and information, participating in world exhibitions, and targeting selected new markets. Lebanon’s policy to promote tourism has been intensified as a result of security and political issues in the region, according to Tourism Minister Fadi Abboud, who also hoped for a “special summer season” in 2011. Earlier in the year, the International Monetary Fund reported that the number of airport passengers (arrivals, departures, transit) totalled 1,024,664 in the first quarter of 2011, marking a 4.5 percent decline from 2010. The number of flights also

declined by 1.3 percent year-on-year, while Beirut hotels saw a sharp fall in visitor numbers, averaging 43 percent in terms of occupancy rates in the first two months of 2011, compared to 73 percent during the same period last year, the IMF said. Lebanon has been in discussions with neighbouring Syria, Jordan and Turkey to create a Schengen-style visa to enable people to travel to any of the four countries without the need to obtain separate visas for each country. Economy

The Economist Intelligence Unit (EIU) forecast for the five years 2010-14 reveals that fiscal reform is needed to reduce the large public debt stock, as the costs of debt servicing weigh heavily on the budget. The substantial current-account deficit is forecast to narrow (as services revenue rebounds) to 19.8 percent of GDP in 2010 and to 13.8 percent of GDP in 2011. Economic growth will depend on perceptions of political stability in the country. Private consumption growth will be slower than in 2007-10, and investment, particularly in homes and construction, will fall back. The EIU forecast for real GDP growth in 2011 to 4.6 percent, from an estimated 7.5 percent in 2010. Businesses will also be less likely to invest in expanding their operations as they will risk not only lower sales but damage to property. The EIU forecast expects that the services sector will continue to be the main driver of private-sector growth. Inflation, after dropping sharply in 2009, because of lower world commodity prices, inflation rose to an average of 4 percent in 2010, picking up towards the end of the year as global oil and commodity prices rose. In 2011-12 inflation is forecast to rise to an annual average of 5.3 percent as international commodity prices, particularly for oil and food, increase significantly. Investment policies, liberal economic environment and active entrepreneurial private sector are the country’s distinguishing features. Investors can benefit from a sophisticated legal framework, which protects the rights and assets of both Lebanese and foreign investors. Lebanon is now a prime destination for foreign investment. It offers a free foreign exchange market, full currency convertibility, complete repatriation of capital and a regulated banking secrecy law. With a 15 percent corporate tax rate, fiscal charges are among the lowest in the world. Lebanon’s principal asset is the competence of its well-educated, multi-lingual and multi-skilled workforce. Lebanon's most important area of economic activity has historically been services, which in 2010 accounted for an estimated three-quarters of nominal GDP. The capital, Beirut, remains a significant regional banking centre. Financial Sector

Lebanon's financial sector, one of the region's most sophisticated, offers a wide range of services and products. Its banking sector, since the 1990s, has been playing a significant role in the recovery of the economy. By most measures, Lebanon's banks are is a solid position, enjoying high levels of deposits and a strong flow of inbound capital while operating in an economy that expanded rapidly last year and is expected to do so again in 2011.

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Lebanon enjoys a free foreign exchange market, full currency convertibility, complete repatriation of capital and a regulated banking secrecy law. These privileges make Lebanon a prime destination for foreign investment and tourism. Investors can benefit from a sophisticated legal framework, which protects the rights and assets of both Lebanese and non-Lebanese investors.

There are 69 banks registered at the National Bank of Lebanon/Banque du Liban, with 62 active commercial banks and 12 specialized banks. Banking currently employs more than 17,660 individuals in 872 branches conveniently spread throughout the country, and manages the equivalent of $90 billion in assets nation-wide. Foreign representation is important either in the form of a foreign bank maintaining branches in Lebanon (11 banks) or equity stakes in several local banks. Sixteen foreign banks have also a representation office in Lebanon. Foreign representation is significant, whether through foreign banks maintaining their branches in Lebanon or equity stakes in several local banks. At the same time, Lebanese banks have expanded abroad, particularly in Syria, Jordan and France. Today, there are eighteen Lebanese banks active in one way or another in sixteen foreign countries. Insurance Market

The Lebanese insurance market has always been open and liberal, in line with Lebanon's free market economy. Private insurers have historically been the only players in the local market and the state has never nationalized or expropriated an insurance firm. Additionally, the Lebanese state never owned insurers and private companies did not have to compete with state entities or worry about government monopolies, as is the case in many other Arab countries. Agricultural Sector

The agricultural sector remains an important source of employment, most rural holdings are small, economically inefficient and rented by subsistence farmers—so agriculture accounts for only around 5% of nominal GDP in 2010. The country's most precious natural resource—vast forests of cedar—was exhausted in ancient times, and today, the main focus of the primary sector is quarrying for the cement industry. Lebanon’s industrial sector is also small, partly because the domestic market shows a preference for imported goods. Among the sector's most significant exports are processed food and jewellery—with the latter showing strong growth in recent years. Energy Sector

The country’s energy sector depends almost entirely on external energy sources, in particular for oil products. Growing energy needs may impact increasingly on the high energy import bill and thus on the country’s economy. It could develop towards a transit country, including to the benefit of secure energy supply to the European Union. Gas pipelines are under development and will bring Egyptian and Syrian gas to the region and possibly further to the EU. Lebanon participates in the Euro-Mashreq Gas Market project that aims to reform and modernise the gas industry in Egypt, Jordan, Lebanon and Syria, and achieve the progressive integration of their gas markets with a view to integration with the EU internal gas market. Rehabilitation of energy infrastructure requires significant investments. Development of the oil sector, including the viability of the operation of a refinery, is under study. Lebanon aims to increase the share of renewable energy sources such as hydro, solar and wind in the country’s energy balance to as high as 10% by 2015.

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IT Sector

The total size of the IT market in Lebanon in 2011 has been forecast at $321 million, which is a significant increase on the nearly $287mn recorded in 2010. A report from Business Monitor International indicated an overall expansion of around 11.8 percent in the country’s IT market, which is set to benefit from a massive investment in telecoms infrastructure, aimed at significantly improving the country’s broadband facilities. Licenses were last year granted to five international companies to establish contact centres in the country and the growth should generate opportunities for IT vendors. Over the next five years, BMI also forecasts that Lebanon’s telecoms infrastructure is set to receive significant investment estimated at $500mn. UK-Lebanon Trade

Trade relations with EU member states, including the UK, are governed by an Association Agreement in force since April 2006. Lebanon is the UK's first largest trading partner in the Levant region and its 8th trading partner in the whole Middle East. It is the UK's 58th largest market overall. The UK is currently the 12th largest exporter to Lebanon, with UK exports valued over £500m in 2010, according to official UK figures. Although the country has not been a traditional market for UK exports, the performance improved following the involvement of UK companies in the country's reconstruction. In addition, a privatisation programme is planned, notably in power, water, telecommunications and aviation. The country welcomes UK involvement in its reconstruction programme. Useful Contacts MINISTRIES

Prime Minister: Mr. Mohammad Najib Mikati Deputy Prime Minister: Mr. Samir Moqbel

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Ministry of Agriculture Minister: Dr. Hussein Al hajj Hassan Website: www.agriculture.gov.lb

Ministry of Culture Minister: Mr. Gaby Layoun Website: www.culture.gov.lb

Ministry of the Displaced Minister: Mr. Alaeddine Terro Website: www.ministryofdisplaced.gov.lb

Ministry of Economy and Trade Minister: Mr. Nicolas Nahhas Website: www.economy.gov.lb

Ministry of Education and Higher Education Minister: Mr. Hassan Diab Website: www.higher-edu.gov.lb

Ministry of Energy and Water Minister: Mr. Gebran Bassil Website: www.energyandwater.gov.lb

Ministry of Environment Minister: Mr. Nazem Al-Khoury Website: www.moe.gov.lb

Ministry of Finance Minister: Mr. Mohammad A. Safadi Website: www.finance.gov.lb

Ministry of Foreign Affairs and Emigrants Minister: Mr. Adnan Mansour Website: www.emigrants.gov.lb

www.foreign.gov.lb

Ministry of Industry Minister: Mr. Freije Sabounjian Website: www.industry.gov.lb

Ministry of Information Minister: Mr. Walid Daouq Website: www.ministryinfo.gov.lb

Ministry of Interior and Municipalities Minister: Mr. Marwan Charbel Website: www.moim.gov.lb

Ministry of Justice Minister: Mr. Shakib Qortbawi Website: www.justice.gov.lb

Ministry of Labour Minister: Mr. Charbel Nahhas Website: www.labor.gov.lb

Ministry of National Defence Minister: Mr. Fayez Ghosn Website: www.lebarmy.gov.lb

Ministry of Post and Telecommunications Minister: Mr. Nicolas Sahnaouie Website: www.mpt.gov.lb

Ministry of Public Health Minister: Mr. Ali Hassan Khalil Website: www.moph.gov.lb

Ministry of Public Works and Transport Minister: Mr. Ghazi Al Aridi Website: www.public-works.gov.lb

Ministry of Social Affairs Minister: Mr. Wael Abu Faour Website: www.socialaffairs.gov.lb

Ministry of Tourism Minister: Mr. Fadi Abboud Website: www.destinationlebanon.gov.lb

Ministry of Youth and Sports Minister: Mr. Faisal Karami Website: www.minijes.gov.lb

EMBASSIES

⋅ British Embassy eet

61 4 417007/403640/405070/412132

.org.lb

Chancery 8th Str Rabieh, Beirut Tel: 00 9 Fax: 00 961 4 402032/715904 Email: britishemb@britishembassy Website: www.britishembassy.org.lb ⋅ UKTI London

ment Middle East Team

si.gov.uk

Paul Bathgate UK Trade & Invest Tel: + 44 (0) 7215 4246 Email: paul.bathgate@ukti.g

Lebanese Embassy ews

7265

.com

⋅ 21 Palace Garden M London, W8 4RA Tel: (020) 7229 Fax: (020) 7243 1699 Email: emb.leb@btinternet

UK in Lebanon kinlebanon.fco.gov.uk/en

⋅ Website: u

HAMBERS OF COMMERCE

C

⋅ Chamber of Commerce, Industry and Agriculture of Beirut and Mount

ayeh,

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Lebanon Beirut SanJustinien Street, CCIABML buildingP.O.Box 11/1801 Beirut, Lebanon

Tel : +961 135 3390/1/2/3/4 Fax : +961 135 3395 Email: eic@ccib.org.lb

tradeinfo@ccib.org.lb Website: www.ccib.org.lb

⋅ Chamber of Commerce, Industry and Agriculture in Sidon and South Lebanon CCI Bldg. Boulevard Maarouf Saad Saida, Lebanon P.O.Box: 41 Saida , Lebanon Tel: +961-7-720123 +961-7-728534 Fax: +961-7-722986 Email: info@ccias.org.lb Website: www.ccias.org.lb

OTHER BUSINESS LINKS

⋅ Association of Lebanese Industrialists www.ali.org.lb/new

⋅ Association of Banks in Lebanon (ABL)

www.abl.org.lb

⋅ Federation of the Chambers of Commerce, Industry and Agriculture in Lebanon (FCCIAL) www.cci-fed.org.lb/English/index.aspx?pageid=415

⋅ Beirut Chamber of Commerce, Industry and Agriculture

www.ccib.org.lb

⋅ Beirut Stock Exchange www.bse.com.lb

⋅ Central Bank of Lebanon

www.bdl.gov.lb

⋅ Lebanese business and economy databank www.databank.com.lb

⋅ Investment Development Authority of Lebanon (IDAL)

www.idal.com.lb

⋅ Council for Reconstruction and Development www.cdr.gov.lb/eng/home.asp

⋅ Solidere, Company for the Development and Reconstruction of Beirut

Central District www.solidere.com/solidere.html

⋅ Port of Beirut

www.portdebeyrouth.com

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