Republic of Lebanon Presidency of the Council of Ministers

Office of the Prime Minister

Stock Taking

“SMEs Initiatives Map”

Salam Yamout

Yasmina El Khoury Raphael

Presidency of the Council of Ministers

Support to SMEs Workshop, May 14 2013, Beirut

Republic of Lebanon Presidency of the Council of Ministers

Office of the Prime Minister

Introduction

• Mapping exercise initiated by MoET, PCM, MOF, and IDAL

• Started in March 2013

• Stakeholders include government and non-government organizations

• 65 initiatives supporting SMEs were identified (but not evaluated)

• All currently under implementation

• Non- Exhaustive List!

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Private, 23

Public, 33

Other, 8

Number of Initiatives by Stakeholders Type

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Access to Finance

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Access to Finance

Micro Credit Institutions (50M) - Association for Rural Development ADR - Al- Majmoua - AMEEN - EMKAN - Others

Others (45 M) -Economic Social Fund for Development (CDR) -Credit for Agricultural and Rural Development Scheme (MOA/Kafalat)

Venture Capital Funds (100 M) - Several VCs : Berytech Fund, Cedrus, MEVP, BBF, Wamda

- iSMEs project (MOF/Kafalat)

Competitions -Bader Startup Cup,Deutche Bank Creative Award, BLC Bank Awards, ESCWA Digital Arabic Content Competition, Maurice Fadel, MIT Arab Competition, Grow My Business, Start Up Cup, Ideaz Prize

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Fiscal, Trade, Sectorial and Industrial Policies

Fiscal Subsidies (Cost on Treasury) & Incentives

-MOF Interest Subsidies on loan in Industry, Agriculture, Tourism, Traditional Crafts, Technology -Exemption from mandatory reserves - MOF Exemptions on custom duties on firms for imports of machinery -IDAL Exemptions on corporate income tax for a period up to 10 years

Sectorial Policies -Industry, Agriculture, Tourism, Traditional Crafts, Technology + Media (BDL, IDAL) - LAISER & CELEP Program (MOA, MOI, UNIDO) - Support to Berytech, BIAT, SouthBIC (MoET, PCM) - EU Charter of Enterprise

Trade Policies - Active bilateral trade agreements and partnerships - Project law to create a an export promotion agency LEBEX - Tripoli Economic Zone (on going)

Support Programs & Institutions

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INCUBATORS / ACCELERATOR - Berytech Technological Pole - Berytech Technology & Health - Berytech Digital Park - Business Incubation Association in Tripoli (BIAT) - The South Business Innovation Centre (SouthBIC) - Seeqnce - Nabad - Ideaz Prize

NGOs (Training) - AMIDEAST / Cisco Entrepreneur Institute - INJAZ (Support) -Bader Lebanon -Endeavor -MIT Enterprise Forum (Mentorship) - Mowgli (Networking) - eClub -Beirut Creative Cluster -Society for Social Entrepreneurship (International Organizations) - GTZ

PROFESSIONAL ASSOCIATIONS - Beirut Traders Association (BD, competition) - Chambers of Commerce (BD, FARO fund) - LIFE (linkage with diaspora) - RDCL - LLWB

Universities - AUB Center for Entrepreneurship - BAU Center for Entrepreneurship - LAU Institute of Family & Entrepreneurial Business

Other (Space) - AltCity - Beirut Digital District - Cloud 5

Government - IRI/ELCIM - Lebanon Soft Shore - SMEs Unit at MoET

• National Employment Office (NEO) / Ministry of Labor / World Bank

Improve the employment prospects of first-time job seekers

Pilot phase: 2.2 M, 1600 beneficiaries, training, NSSF incentives to employers

• AMIDEAST / Cisco Entrepreneurs Institute

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Skilled Human Capital

• IDAL & MOET (300K/year)

- Support in Exhibitions and Fairs

• IDAL

– Agro Plus & Agri Plus Programs (30M)

– Business Linkages for ICT Program

– www.investinlebanon.gov

• MoET

- Qualeb Program

• MOI

- Lebanon Soft Shore

• Chambers of Commerce

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Access to Markets

RIYADA RED

MEVP

Kafalat

BIAT

SME Unit

Early

2000

Fun

ds

Fa

cilit

ato

rs

Source : Zawiya and Endeavor Lebanon

Late

2012

Cedrus

BBF

Berytech BADER MIT

SouthBIC

Berytech Fund

LBA

AltCity

Endeavor

Wamda

+ Inno

Mowgli

AMIDEAST

Arabnet

VC Incubator / Accelerator Bank Guarantor Facilitator Angel

# of VC

Deals

0 0 0 0 0 0 0 0 2 1 7 9 13

Size of bubble indicates amounts of fund

Seeqnce

Entrepreneurial Culture

Exponential Organic Growth: New Comers in 2012-2013

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ENTREPRENEURS

LEBANON WWW.ENTREPRENEURSLEBANON.COM

Entrepreneurial Culture

• Lebanese Industrial Research Achievements (LIRA) ALI&CNRS (since 1997)

• MOI Innovation Vouchers (300K)

Up to EUR 10K for innovative concepts (since 2012)

• ESCWA Technology Center

• Innovation Survey (CNRS, PCM, & World Bank)

Ongoing - Results to be revealed 28 June 2013

• iSMEs Project (MOF / Kafalat / PCM / World Bank)

2.5 M for concept grants / 25 M government co-fund equity in innovative SMEs

Awaiting parliament ratification

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Technology and Innovation

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Business Regulation , Legislation and Enforcement

Improve the Business environment in Lebanon “IBEL” 2010 PCM MoET MOJ Central Bank IFC EU

- Commercial Registry Modernization and Automation Started 2012 ongoing - Amendments to the “Code du Commerce” 1st phase submitted to parliament SAL, SARL, Sole Partnership 2nd phase on-going Preferred shares, GDR and M&A - Law on Secured Lending

- Bankruptcy Law

- project to encourage judicial mediation (started)

Next Batch - Competition law - NSSF and Labor Law

Draft Laws Completed Awaiting Ratification Ministry Status

Draft Law on Public Private Partnership HCP, MOET Submitted 2007 Amended and resent 2012

Draft Law aiming to exempt profits of industrial exports of Lebanese origin of 50% of the tax due

MOI Submitted 2012

Law on e-Transactions and Protection of Personal Data

PCM Submitted 2005 Amended and resent 2012

Draft Law aiming to establish a Lebanese Export Development Agency (LEBEX)

Submitted 2007

Amend implementing Decrees for Investment law 360/2001

IDAL Submitted 2012

Draft Law on public procurement law OMSAR Final stages

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Business Legislation, Regulation and Administration

Conclusions and Recommendations

1. Government is very present! Should we do more… or less?

2. Lots of movement and activities – not necessarily coordinated or impactful

3. Challenge #1: Improve the support “upstream” (R&D, technology transfer, etc.)

4. Challenge #2: Move away from generalized to specialized support

5. Qualitative vs. quantitative analysis

How do we measure the impact? How do we measure progress?

Number of jobs created? Income tax generated?

6. We need to continue the mapping and find a reference place for all initiatives

www.entrepreneurslebanon.com

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