Experts: High cost of fuel and energy hurting Lebanon's agro-food industry

01 April 2011

BEIRUT: Industry specialists renewed calls to prop up agro-industry at the widely promoted Horeca food exhibition Thursday, urging for more aggressive enactment of quality regulation, as well as a speeding up of industrial development.

“The cost of production [in the food sector] is high when compared with neighboring Arab countries due to energy and fuel costs that are five times higher than they are in the rest of the Arab countries,” said George Nasrawi, president of the Syndicate of Lebanese Food Industries.

Labor costs, absence of government support for infrastructural development and a lack of protections for industrialists also put the Lebanese industry at a significant regional disadvantage, Nasrawi added.

Lebanon’s agro food exports reached $324 million in 2010, according to Association of Lebanese Industrialists

The country’s industrial exports in 2010 jumped by 8.26 percent to $3.3 billion although the balance of trade deficit continued to widen.

Lebanese industrialists have been lobbying the government in vain to pay more attention to the manufacturing sector, stressing that industrial plants employ thousands of people.

These industrialists also believe that most if not all free trade agreements with the Arab countries have inflicted heavy damage on this sector because the cost of production in these states are far less than those in Lebanon.

Local manufacturers also say that Arab states heavily subsidize all their exported goods and this according to them runs contrary to the conditions of the World Trade Agreement.

The Lebanese Food Industries Syndicate organized the conference entitled “Steering the Lebanese Food Industries Toward International Excellence,” gathering several industry and hospitality sector leaders as well as an Industry Ministry representative. Some officials from the United States Agency for International Development and from the United Nations were also present.

“We’re all calling for national produce that stays faithful to renewed industrial schools of thought,” said president of the Association of Lebanese Industrialists Nemat Frem.

“[We should] harness innovative industrial and packaging techniques, storage and transport that would work side by side with agricultural produce that has a delicious, original Lebanese taste,” Frem added.

Paul Ariss of the Association of Restaurants and Cafes said he believed the hospitality sector has made some large strides forward since Lebanese Civil War ended two decades ago. Three thousand new restaurants have since been opened, creating over 60,000 jobs, according to Ariss.

The hospitality sector is an important driver of growth in Lebanon, where services make up nearly 80 percent of national production.

Agriculture pales greatly in comparison, with the sector receiving less than 1 percent of government funds.

Fifty-five percent of Lebanon’s food bill comes from imported produce, a statistic that many experts say is the result of decades of government neglect in the agricultural sector.

Food quality assurance also figured prominently into the debate at the conference, with some participants urging more sustained communication with consumer groups and a more formal consolidation of inter-ministerial quality assurance measures.

Zuheir Berro of Consumers Lebanon said the efforts to ensure proper quality foods were overlapping between the various ministries and called on Ministries to centralize quality services.

Siham Daher from the Consumers Protection division at the Economy Ministry said that her office’s work to protect against food pollutants was made more difficult by the fact that the Economy Ministry cannot supervise agro-industrial factories.

She urged the Agriculture Ministry and Industry Ministry to enact ministerial powers that allow them to conduct surveillance rounds at the factories.