| 08 Feb 2010 |
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US guide highlights Lebanon's favorable investment climate, warns of red tape
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08 February 2010
BEIRUT: The US Commerce Department’s 2009 Country Commercial Guide for Lebanon (CCG) highlighted the country’s favorable investment climate and its liberal economic system, but said red tape and an unpredictable operating environment are some of the issues hurting Lebanon’s image as a country open for investment, as reported by Lebanon This Week, the economic publication of the Byblos Bank Group.
It said the country has very few restrictions on the movement of capital across its borders, foreign investors are allowed to manage and hold business and private assets without any restrictions, and the government does not require investors to engage in any particular sector or project. It said corruption is more extensive in state contracts, taxation and real-estate registration than in private-sector deals and that Lebanon is not a signatory of the OECD convention on combating bribery.
The US Commerce Department said Lebanon is the 64th largest market for US exports, up from 68th largest in 2008, adding that the US exported $1.1 billion worth of goods to Lebanon in the first nine months of 2009. The top five US exports to Lebanon in 2009 were vehicles with $521 million, mineral fuel and oil with $99 million, machinery with $79 million, and electrical appliances and cereals with $26 million each. It noted that major competitors of US companies in Lebanon include French, Italian, German, British, Korean, and Chinese firms.
The guide said leading Lebanese sectors for US exports and investment include the automobile sector, air conditioning and refrigeration equipment, pharmaceuticals, medical equipment, apparel, education services, and agriculture.
The CCG expected the US share of the local auto market to reach 16 percent in 2009, adding that demand for US automotive products such as brakes, clutches, engine lubricants and safety accessories are increasing because of their quality advantage over foreign competitors.
Also, US air conditioning and refrigeration exports to Lebanon reached $210 million in first 10 months of last year, with a projected market share of 16 percent in 2009. Further, US pharmaceuticals accounted for about 7 percent of total pharmaceutical imports in the first 10 months of 2009. Also, US exports of medical equipment reached $43 million in the first 10 months of last year, and US market share was expected to reach 24 percent in 2009.
It noted that Lebanon is an ideal location for establishing a regional office to cover the Levant, including Iraq.
Also, US apparel exports to Lebanon reached around $9 million, about 3 percent of total apparel imports to Lebanon, while US agricultural exports totaled $121 million, equivalent to 6 percent of agricultural imports to Lebanon.
Major US agricultural exports to Lebanon include dairy products, cereals, beverages and spirits and tobacco.
Finally, the guide noted that Lebanon has among of the best educational systems in the Middle East with 160,300 students enrolled in universities throughout Lebanon and over 1,800 Lebanese students studying in the US.
In parallel, the US Commerce Department considered the Information & Communication Technology (ICT), pharmaceuticals and insurance sectors as offering the best prospects. It said Lebanon has the fundamental building blocks needed to become a regional center for technology that include a highly educated and multilingual workforce, a strong private sector, world-class advertising firms, and multi-lingual media-content providers and web portals.
Additionally, Lebanon is the leading importer of pharmaceuticals in the Levant, as 95 percent of the $630 million market consists of imported medicine. – The Daily Star
© Copyright The Daily Star 2010.
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