29 June 2010

BEIRUT: Prime Minister Saad Hariri said Monday that the government should reduce corruption, improve public performance, ensure stability and end power rationing to improve the business climate in the country.

Hariri, who made these remarks during the opening of a World Bank sponsored conference on ways to improve the business climate at the Grand Serail, said one of the goals of his government is to find jobs for the youths.

“There is no doubt that improving the business environment, including means to attract investments and facilitating the establishment of new companies, is one of the basic conditions for creating job opportunities in our economy,” Hariri said.

He added that the World Bank considers at present that starting a new business project in the private sector in Lebanon requires nine days to complete the legal and official administrative procedures, as compared to a rate of 20 days in the Middle East and North Africa region.

“This starting point might seem good but it is not enough, from our perspective, to achieve our goal which is to turn Lebanon into a trade and business center in our Arab region. Thus, we are determined to solve the legal and administrative complexities that impede the fluency of doing business and the easiness to close business, which is considered by the investor just as important as launching it when the decision is taken,” Hariri said.

The prime minister said that the government’s top priorities are increasing security and safety, reducing corruption, improving the performance of governmental services, guaranteeing permanent power supply, ensuring comprehensive and easy access for the broadband and internet services, better environment, better water management, minimizing traffic problems, and improving communication with the Lebanese Diaspora.

“Our economy was able to achieve a growth rate of 8 percent per year over the last three years. The International Monetary Fund expects the same growth for this year, while the ratio of debt to our Gross Domestic Product declined by around 30 percent during the same period,” Hariri said.

He added that all these positive developments could not have been possible without the private sector in Lebanon and our free economic system which prevailed and prevails every day over the internal challenges and the numerous external crises faced by our small country.

“This underscores the need to strengthen and protect our economic system as well as consolidate the criteria and legislations which govern the function of the market and protect the citizen and the consumer,” Hariri said.

“I want to stress that our priority, in the field of improving business environment, would be to facilitate the initiatives and the activities of the small and medium-sized enterprises, which represent 90 percent of the companies operating in Lebanon now, and thus provide an income for the broader segment of the Lebanese society.”

World Bank’s Middle East director Hadi al-Arab said the basic element in achieving sustainable growth is through increasing productivity and this depends on a competitive environment in business fields. “Competition has long and durable impact on the economic performance and this can be done through improve incentives,” Arab said.

He disclosed that monopoly companies in Lebanon control 16 percent of the country’s Gross Domestic Product.

Arab added that Lebanon was still in a weak position in terms of doing business with a rank of 100 among other countries.

Arab underlined the need to speed up the process of papers, increase the speed of issuing licenses and permits as well as create more dynamism in the private sector.

He warned that corruption and the weakness of capabilities would limit employment opportunities. “It is inevitable to reform the investment environment in Lebanon and to allocate the benefits equally among all citizens.

Arab added that it was imperative to end monopolies and exclusive dealerships and to build stronger institutions capable of administrating and organizing the markets.

He said the World Bank was willing to help Lebanon in developing and correcting the investment climate and implement its reforms in all fields.

Finance Minister Raya Haffar Hassan said the Finance Ministry was always seeking to facilitate procedures and paperwork of tax payers and companies.

“We are following the developments in dealing with the tax systems around the world and we implement the good elements of these developments in order to maintain a balance between revenues and just taxes among all tax payers,” Haffar said.

She added that the private sector was a main engine for economic development in Lebanon and this “should induce us to exercise more effort to improve the business environment so that they are able to draw more funds and capitals.”

Mohammad Fneish, minister of administrative reforms, told the conference participants that small- and medium-size companies were the backbone of the economies of both developing and developed countries.

He added that his ministry was currently preparing and implementing several projects that aim at improving and developing public services.

Fneish said his ministry was working closely with the Agriculture, Education, Tourism and Health ministries to launch what is termed as the one-stop-shop to process all applications and papers. – The Daily Star

Copyright The Daily Star 2010.