31 August 2012
BEIRUT: Lebanon may be facing daunting political and security challenges, but not all investors have thrown in the towel yet on multimillion-dollar projects in the country. Nabil Itani, head of the Investment Development Authority of Lebanon says some investors remain undaunted.
“Contrary to the general impression, investors who have approached IDAL to facilitate their projects and receive incentives are still determined to complete the work they started two years ago,” he told The Daily Star Thursday.
“None of them have decided to quit Lebanon because they know that the country will eventually overcome its current problems,” Itani added.
One such enterprise that is confident of Lebanon’s future is Beirut-based Horizon Management, a firm which is currently putting the final touches on the $45 million Staybridge Suites Hotel in the neighborhood of Verdun.
The hotel, which will create 170 new jobs, will receive tax incentives from the IDAL this year.
“There are other examples [of major projects] in different regions of the country as well,” Itani said.
He added that IDAL had processed more than $1.5 billion worth of projects since 2004, and in 2012 alone the agency was seeing close to $300 million worth of projects in different parts of the country.
“Burning tires and blocking roads is not the picture which we want to convey to the public. There are still many investors who have faith in Lebanon and the millions of dollars they have put in these projects shows that the country still attracts investments despite some of the security and political problems.”
However, Itani’s upbeat assessment of the investment situation is not shared by most businesses and merchants, who have reported sharp drops in sales and hotel reservations since the Syrian crisis erupted 17 months ago.
Many hotels in Beirut and Mount Lebanon have been compelled to offer significant discounts to lure tourists, but even these bargains have failed to persuade Gulf Arabs to visit the country.
Top business leaders blame the government and politicians for the steep economic slowdown that Lebanon is currently experiencing.
But Itani insists that this gloomy picture is not shared by all investors.
“I am stating facts and statistics. There are many projects in the pipeline. One of the projects which will be unveiled at the end of the year is a new hotel in Summer Land. The project is financed by a Saudi investor.”
Itani also plans to inspect next week a pharmaceutical plant in south Lebanon which was approached by IDAL and receives tax incentives.
Located in Jadra, south Lebanon, the Arwan pharmaceutical plant is a $17 million project that created 83 new jobs.
IDAL offers various incentives to any project that creates hundreds of jobs in the areas of tourism, industry, technology and agriculture. The agency encourages companies to invest money outside the capital with special emphasis on industry and technology.
Other projects in the field of technology include Waves Company, on the outskirts of Beirut, which will create 50 new jobs. The $12 million project involves the delivery of high-speed Internet using Wi-Max technology.
Itani added that there were other mega projects in Beirut Central District which would start in a month or two such as the construction of the Oriental Hotel and an entertainment center.
“But there are still some investors waiting for the situation to improve in Lebanon before making commitments,” he said.
Itani said most of the investors who have approached IDAL in the last two years are Lebanese. He added that foreign direct investment in Lebanon did not make significant strides this year.
“The volume of FDI this year will be close to 2011 figures which stood at $4 billion. Most of these projects involved real estate projects,” Itani said.
But some economists and critics have said that most of these projects are directed toward real estate. According to them, this sector has no added value to the economy and will not create new jobs in the market.
Copyright The Daily Star 2012.
