24 October 2012
BEIRUT: Michel Daher is a man of many talents – a successful businessman and financial entrepreneur who like many Lebanese industrialists is disheartened by the country’s shortsighted policymaking.
In an interview Tuesday from his Downtown Beirut office, which overlooks a newly erected opposition sit-in, Daher spoke about his successes in Lebanon and abroad amid increasing economic risks.
Best known in Lebanon and the Middle East for founding Master Chips and Poppins, two of the largest fast-moving consumer goods companies in the region, the businessman decided to return to his Bekaa town of Ferzol near Zahle in 1992 after the end of the Lebanese Civil War.
“I wanted to come back to my hometown after years of living and doing business abroad. In my region most people are involved in one way or another in potato plantations and I wanted to help make a difference for the local community,” Daher said.
But some people were skeptical about the chances of creating a successful potato chip factory.
“Some thought I wanted to build ships and others thought I was talking about computer chips. Those who understood the concept thought it was a doomed idea,” he said.
However, Daher proved skeptics wrong as his Bekaa venture grew into a successful national company, which currently has over 1,600 employees with hundreds more directly or indirectly living off the firm.
Another landmark achievement came in the late 1990s, when Daher’s son George skipped lunch for a meal of cornflakes.
“I looked at the pack of the 375-gram pack and realized it was [over-priced] at LL7,500. This is when I saw a great opportunity to expand the business in Lebanon,” he said.
People were suspicious again thinking Poppins would never take off against competition from giants including Nestlé and Kellogg’s.
But because he had been introduced to a retired consultant from Nestlé, luck was on Daher’s side again and he went on establishing what would later become a market leader in many Levant and GCC countries. Poppins now exports cornflakes to over 50 countries worldwide.
Still, despite his businesses’ success in Lebanon, Daher drew a bleak picture of the Lebanese economy.
Unless the government embarks on painful austerity measures, Daher warns, Lebanon’s economy will inch closer to the edge of a disaster not unlike what Greece is witnessing today.
Daher added that limiting public expenditures and curbing debt should top the government’s agenda to avoid any rise in interest rates paid on national debt.
“If Lebanon’s debt rating is downgraded and interest rates soar ... we will enter a vicious cycle given our already falling exports, declining tourism and soaring production costs. Quite frankly this is no less than a recipe for disaster,” he said.
Like the majority of Lebanese exports, Poppins is suffering from fierce competition abroad due to lower demand across the region, and the firm had to lower production over the past year by some 30 percent, Daher said.
Yet he remains upbeat about the prospects of Lebanon’s industrial sector, particularly the agro-industrial segment. Daher believes this segment could prosper if further investments are poured into the ailing agricultural sector.
Most of Daher’s investments are concentrated in the United States, where he owns 27 companies, focusing on new business trends in financial services and social media.
Back in 2007, Daher joined Lehman Brothers, Long Ridge Equity Partners and Yale University to purchase 35 percent of Forex Capital Markets (FXCM).
After he became a major shareholder in the world’s largest retail forex company (with more than 200,000 clients), Daher was the only Lebanese businessman invited to ring the opening bell of the New York Stock Exchange, an honor that has only been given to Central Bank Governor Riad Salameh, he said.
Daher also spoke about his recent investment in Grubwithus.com, which he says was aimed at bringing social media to the “in person realm.”
The U.S.-based website is a community service portal where people create and join group meals to discuss any topic of shared interest with would-be friends and colleagues.
Asked about steps needed for the country to take off from the current downturn, Daher said Lebanon needs to shift attention to job creation and maintain local talent instead of exporting it.
“We need 50,000 jobs a year and we can barely create any. We take pride in the very thing we should be ashamed of; sending our children to work in other countries,” he said.
Copyright The Daily Star 2012.
