LEBANON - Economy
Minister of Economy and Trade, Lebanon
HE Raed Khoury is a Chartered Financial Analyst (CFA) and holds a BA in economics and a master’s degree in banking and finance from the American University of Beirut (AUB). He is founder of Cedrus Invest Bank and Cedrus Bank SAL, and has extensive and varied banking experience with a focus on wealth management, investment, and commercial banking services. He also spent more than seven years with Audi Group where he held senior management positions in private banking in Lebanon, Switzerland, and Saudi Arabia.
The prolonged crisis in Syria continues to dominate Lebanon’s outlook with losses exceeding USD13 billion to date as per the World Bank estimation. Moreover, growth has been subdued due to further pressures on the economy’s depleted infrastructure, the chronic trade and fiscal deficits, and the lack of public and private investment. However, the major political breakthrough of the presidential election of the president and formation of the government will again help boost the confidence in the economy and spur growth to return to the levels registered between 2007 and 2010. Moreover, we see consumer and investor sentiment improving alongside the inflows of tourists and capital. However, the country can witness major positive improvements only if structural reforms are implemented. These reforms are aimed at improving consumer and investor confidence, boosting economic growth, accelerating deposit flows, and strengthening financial stability. These reforms include those that reduce infrastructure bottlenecks (mainly through the adoption of the PPP law), enhance the business environment for Lebanese enterprises to grow and create jobs, and encourage investments in sectors where Lebanon holds a comparative advantage.
The Protection of National Production Legislation and that was adopted in 2008 governs the international commercial practices that cause injury or threaten to cause injury to the domestic industry or agriculture in Lebanon, or retard the establishment of such industry or agriculture, specifically when a given agricultural or industrial product is being dumped, or subsidized by the governments of the exporting authorities. This legislation is also applied on increased imports that cause serious injury or threaten to cause serious injury to the domestic industry or agriculture in Lebanon. As a result of the investigations taking place, measures could be taken to protect domestic industry in the form of additional tariffs for a limited period of time. As such, this anti-dumping, countervailing, and safeguard mechanism is used to protect any Lebanese sector or product at risk from the increased imports.
The Ministry of Economy and Trade is developing a strategy aimed at balancing trade flows with new and existing markets such as the Mercosur, Africa, Iran, Russia, and others. Our aim is to work toward decreasing the gap between our imports and exports. As such, several studies and research are being undertaken to identify the products with export potential to these markets of interest. Some these products include wine, olive oil and agro-industrial products, jewelry, fashion, crafts, and ICT.
The process is being expedited technically as per the roadmap agreed on with the WTO. In fact, the technical team at the ministry is finalizing the accession package, including the goods and services offers that will be circulated to WTO members in preparation for a working party meeting that is expected to take place in May. It is important to note that we are engaging with all relevant ministries and stakeholders to make sure that Lebanon’s best interests are sustained and that offers are prepared meticulously to avoid as far as possible any obstacles or misunderstandings in the future process.
The law is still a draft; however, it is in its advanced stages. We at the Ministry of Economy and Trade encourage these mergers, as we believe they would enhance the capital of companies and consequently enhance their ability to compete locally and regionally. The insurance sector is an important sector and the ministry will undertake all the necessary measures to achieve its constant development and growth.
Our priority is definitely to build on what has been done in the previous years and mainly with regards to undertaking the necessary procedures aimed at protecting the Lebanese consumer, attracting FDI and spurring exports, enhancing SME development, and mitigating the impact of the spillovers of the ongoing Syrian crisis. With regard to consumer protection, we believe that a well informed and a well-protected consumer is critical to a strong and stable economy. We will continue to enhance and stress on the very important role played by the Directorate of Consumer Protection at the Ministry. On the FDI and exports level, our goal is to enhance the business climate to encourage investments and trade and the movement of capital inflows. This will mainly be done by strengthening current relations and establishing new ones by opening up to new non-classical markets to trigger investments and spur Lebanese exports. This comes in addition to improving market access through the participation of Lebanese companies in international exhibitions through agreements with partner countries. With regards to SME development, we will undertake the needed steps to ensure the implementation of the National Strategy for Small and Medium Enterprises that was launched in December 2014. This will allow for job and growth creation. We are organizing roundtables, joining major stakeholders and tackling important topics in this regard and covering all the regions in Lebanon. And last but not least, the ongoing Syrian crisis has had tremendous spillovers on our economy, and as such our goal is to mitigate them as much as we can. Work will be done through the inter-ministerial committee, the LCRP whereby the needs and budgets have been identified, the international committee support and interventions are extremely crucial for the attraction of the needed funds to cover the developmental issues of Lebanon such as infrastructure projects, strengthening the public sector institutions and implementing reforms, besides humanitarian and relief activities.