Moody’s: tax hikes, budget are credit positive. Normalized budget process may ease access to donor financing

The tax hikes recently approved by Parliament will pave the way for the ratification of the first public budget since 2005. This would be credit positive for the country, according to Moody's. Currently, the rating is 'B2 negative' by the agency.

A normalized budget process would also allow the government to reduce its fiscal deficit. This is expected to drop from 9.5 percent of GDP in 2016 to 8.9 percent in 2017 and 8.7 percent in 2018, the credit rating agency said in a recent research ...

Article details

$2 billion invested in investment funds. Half are in local funds

Subscriptions in local and foreign investment funds totaled $1.95 billion in 2016, according to the annual report of the Capital Markets Authority (CMA) for 2016. This represents an increase of 17 percent compared with the subscriptions recorded in 2015.

The increase in the value of subscriptions was the result of new regulations and new measures taken by the CMA which have encouraged investment in financial securities, said Tarek Zebian, Director of Research and Communication at the CM...

Article details

Exports to Iraq to pay duties. Leaves Greater Arab Free Trade Agreement

Custom duties on local agricultural and industrial exports to Iraq are now being levied, according to Iraq's commercial attaché Yasser El Zobeidi.

"Our Council of Ministers took the decision to leave the Greater Arab Free Trade Agreement (GAFTA) and start imposing custom duties on incoming merchandise two months ago," he said.

According to El Zobeidi, Iraq's decision is due to its "very weak and dwindling capacity to export." He said that since the decision was enacted, loca...

Article details

Beirut Municipality introduces e-payment of fees through banks.

Beirut Municipality has agreed with a number of banks to allow taxpayers to pay municipal fees electronically through the banks.

The offer is still open and other banks could participate as well, said Hoda Osta, a member of the Municipal Council of Beirut.

The Municipality also plans to operate its own electronic payment means within a year through its website and a payment function on its existing mobile application, Osta said.

Taxpayers currently pay the municipal fees i...

Article details

Tender for power ships rejected by oversight agency. Karadeniz was the only bidder

The tender for two additional power barges with a capacity of 425 megawatts has been rejected, according to the Department of Tenders.

A source at the Department said: "Only one bidder, Karadeniz, applied for the tender. By law, there should be at least two competing companies."

Karadeniz, a Turkish firm, is currently providing electricity through two power ships, Fatmagul and Orhan Bey.

"We were surprised that the file of Karadeniz was incomplete as well," the source said....

Article details

Tourists tax-free spending is up. Fashion and clothing top the list

Tax-free spending has grown six percent in the first half of the year compared to the same period last year, according to the Global Blue report 'Insights into Tourist Spending' for the first semester.

Joe Yaacoub, Head of Commercial Lebanon at Global Blue, said: "It is the first year in four years that we started to recover. This is because Saudis and Kuwaitis have returned to the country."

The number of tourists also grew 14 percent in the same period reaching 826,129 visitors, ...

Article details

Property sales are on the rise. 26 percent growth for foreigners

The property market has witnessed an improvement in the number of recorded sales transactions during the first half of the year compared to the same period of 2016, according to figures released by the Real Estate Registry.

The number of property sales transactions increased 12 percent to 33,584 with a combined value of $4.5 billion, also up 12 percent. The value per transaction averaged $134,000, almost unchanged from the same period last year. This indicates that property selling prices...

Article details

Charles Helou Station to be restored.

The Council for Development and Reconstruction (CDR) will initiate a complete overhaul of Charles Helou Station for Travel and Land Transport. The CDR will also be responsible for the initial study and the implementation of the process. The project was initiated by Beirut Municipality and approved by the Council of Ministers last week.

The plan includes the renovation of the whole building. The ground floor will continue to be used as a public transportation hub for internal and external ...

Article details

19 taxes legislated. Value Added Tax raised to 11 percent

Parliament ratified on Wednesday additional tax laws to those voted in March, bringing them to 19. Minor amendments were introduced to the articles. The tax law will be used to finance the increases and changes in the salary scale of public employees.

The Value Added Tax (VAT) was increased to 11 percent.

A law on the illegal occupation of public maritime property was also ratified. Prime Minister Saad Hariri said: "This issue should have been resolved 20 years ago but because toda...

Article details

iflix video on demand offers local programs. To serve the middle class, the unbanked, rural communities

Malaysia-based iflix, a subscription video-on-demand service focused on emerging markets, has launched local operations from Jal-el Dib, Metn. It will offer local and Arab series, films, soaps, and English-spoken products with Arabic subtitles. Subscriptions start at $4 a month.

Nader Sobhan, Head of MENA region, said: "Lebanon punches way above its weight when it comes to media production. It is important to have a presence here."

The company has a deep integration with telecommun...

Article details

Salary scale ratified by Parliament. Public employees working hours extended, Saturdays are off

Parliament has ratified 38 articles forming the salary scale law for civil servants and public employees.

The first item approves raising the minimum monthly salary to $450 for employees in public administrations, municipalities, the Lebanese University, and other public institutions that do not operate under the Labor Law. The increase is now equal to that of the minimum salary of private sector employees.

All public employees of different ranks will be immediately given three pa...

Article details

Shareholding at the EBRD completed.

Lebanon has become a shareholder of the European Bank for Reconstruction and Development (EBRD).

This will allow it to become a recipient of the bank's investments and advisory services.

President Suma Chakrabarti, said: "We expect that by early September, it will be a full country of operations."

The country can benefit from direct investments in loans and equities, and the technical support the Bank can provide it with.

Chakrabarti said: "Lebanon has massive transi...

Article details

Old movie theaters target for renovation. 1,500 seats in Tyr and Nabatieh, Tripoli and Bint Jbeil are next

Qassem Istanbouli, an actor and director, has launched an initiative to rehabilitate old movie theaters in rural areas.

Istanbouli is currently crowdfunding for the renovation of the Rivoli Cinema in Tyr. He has already renovated Stars Cinema in Nabatieh and Cinema Hamra in Tyr. Once the restoration of Rivoli is complete, a total of 1,500 seats and three screens would have been restored.

"Our goal is to restore the role of these movie theaters as cultural centers that they once wer...

Article details

Paper products factory has opened near Jbeil. To export half of production to Europe and Arab countries

Millennium Paper Products opened this week a factory for paper products in Hsoun, Jbeil.

The total built-up area of the ISO-certified factory is 9,000 square meters (m2), and includes three floors. The machinery was imported from Germany.

Investment in the project exceeded $10 million. Rabih Awad, CEO, said they borrowed a subsidized loan from banks to fund part of the project.

Production capacity of the factory is expected to reach 40,000 copybooks and 20,000 books per d...

Article details

Central Bank operation replenishes foreign reserves. $3 billion raised so far through program undertaken with banks

The Central Bank (BDL) started an operation in June – still ongoing – to replenish foreign currency reserves lost since the beginning of the year. The operation yielded $2.3 billion in June, according to a Bank Audi newsletter. It has surpassed the $3 billion mark since its debut, according to a banking source.

The operation involves getting banks to make simultaneous deposits at BDL in lira at one percent above market rates locked for at least seven years, and in U.S. dollar at one perc...

Article details

Smart address system for five municipalities.

A smart addressing system is coming to the Municipalities of Mtayleb (Metn), Deddeh (in the north), Jounieh (Kesrouane), Zahleh (Bekaa), and Dekoueneh (Metn). The system includes digital street maps that are connected to smart signs complete with barcode on each building to create a unique geographical address.

According to Abdallah Bsaibes, Chairman of Geo Spatial Minds, the company responsible for the implementing the digital mapping system, it is the first of its type in the country...

Article details

Three wind farms in Akkar get licensed. Companies to sell electricity to the State

The Council of Ministers approved three permits for private companies to operate wind turbines for electricity.

The permits will be operated by Hawa Akkar, Sustainable Akkar, and Lebanon Wind Power. They will be used for the production of 200 megawatts (MW) of wind power, according to Pierre Khoury, Chairman of the Lebanese Center for Energy Conservation (LCEC).

All three wind farms will be located in Akkar.

A Power Purchase Agreement (PPA) will be signed with the three com...

Article details

Customs plans to modernize clearance. Electronic declaration, faster inspection, better tariffs

The newly-appointed General Director of the Higher Customs Bureau Badri Daher has launched a plan to upgrade Customs procedures, limit expenses, and lower fees for exporters.

Customs will work on three main procedures in the next three years.

The first, according to Daher, is electronic declaration.

"Custom clearers and traders will be able to declare their shipments online. We will decide, according to a series of measures and indicators, whether these shipments will be i...

Article details

Decrease in MEA net profits.

Middle East Airlines (MEA) announced a $94 million net profit compared to $98.5 million in 2015. Net profit margin increased by one percent to 14 percent.

Revenues declined 11 percent and reached $672 million, in spite of a two percent increase in passengers through Rafic Hariri Beirut International Airport (RHBIA). The drop was offset by falling oil prices during the period.

A source at the company said that the decrease in revenues is linked to a 13 percent decline in average ti...

Article details

Reclamation complete at the Tripoli economic zone. Area ready for infrastructure works

The reclamation of Tripoli Special Economic Zone (TSEZ) is complete, Chairperson Raya Haffar El Hassan said.

Works on infrastructure are now set to begin.

El Hassan said: "The Council of Ministers has provided us with $15 million for infrastructure already."

An additional $30 million is needed to finish the works.

"These funds can be acquired through bank loans," she said.

Infrastructure works are expected to take up to around three years.

El Hassan ...

Article details

Ministry of Foreign Affairs to launch job creation project. Encourages Syrians to return home

The Ministry of Foreign Affairs (MoFA) is readying the Subsidized Temporary Employment Program (STEP) for launch in the next few weeks.

The goal of STEP is to support job creation in SMEs, according to Rami Adwan, advisor to MoFA. STEP aims to have investments reaching $120 million yearly.

The project comprises three components: The first is to provide support to SMEs through a process of matching capital whereby the amount put forth by SMEs is matched in the form of grant from int...

Article details

Montreal-Beirut direct route rejected.

The Canadian government has rejected Air Canada's request to re-initiate Montreal-Beirut direct flights. A spokesperson at Air Canada Foundation, confirmed the unofficial declaration of the company's Vice President of Global Sales.

Air Canada failed to clarify the reasons behind the refusal. But sources at the Canadian-Lebanese Chamber of Commerce and Industry related the rejection to security factors.

A source at the Civil Aviation Authority in Rafic Hariri Beirut International Ai...

Article details

$100 million SME VC fund started by EuroMena. Targeting all sectors except real estate

EuroMena Funds, a manager of venture capital funds, is launching a $100 million fund targeting small to medium enterprises (SMEs) by the end of the year.

"We are being contacted by SMEs that need investment tickets of $3 to $10 million. Our investment ticket in EuroMena III is $20 million, too large for local ones. There is a large need for this kind of funds," Romen Mathieu, Managing Partner of EuroMena Funds, said.

All sectors except real estate will be targeted by the fund.
Article details

BDL to raise ceiling for industrial export soft loans. Conditions to ease in a bid to benefit SMEs

The Central Bank (BDL) will raise the ceiling of soft loans provided by banks to finance the working capital of industrial exporters to $3 million from $2 million, according to Wael Hamdan, Director of BDL's Financing Unit.

The decision is an amendment to a BDL ruling addressed to the banks last May through intermediate Circular 462.

Manufacturing companies that export at least 25 percent of their output will be eligible for the soft loans instead of the current 50 percent.

Article details

Robots to bag sales at Virgin Megastore. Store introduces android sales assistants

Virgin Megastore Lebanon has introduced a humanoid robot as a member of the company's sales team. Vee, the robot's name, will be rolled out across all stores countrywide and is the first Virgin retailer to do so in the region. The company has also launched an entire range of educational robots, tele-presence robots, and social robots Nao and Bobi, including Vee.

Pepper is the brand name of Vee. She is able to guide customers around the store helping them to choose gifts, as well as readi...

Article details

Banks get to open more branches per year. BDL Circular aims to expand financial inclusion

The Central Bank (BDL) will allow banks to increase the number of branches to three per year, up from two currently, provided that at least one of the new branches uses modern technology, according to BDL's intermediate circular 467.

BDL said it may even allow a bank to exceed the three-branch-a-year ceiling if it finds a good reason for that, especially if the bank plans to open branches outside big cities.

The Central Bank has also issued another intermediate circular, numbered 4...

Article details

U.S. health insurer starts Beirut operation. Fortune 100 company acquires Zurich Middle East

U.S.-based health and wellness insurance company Cigna Corporation has launched local operations. Headquartered in Beirut, it will operate throughout the Middle East.

Cigna announced today it has purchased Zurich Insurance Middle East, which was also based in Beirut. It will operate in the region through Zurich's insurance license. Zurich will be rebranded with time under Cigna. Due to its license, Cigna will be present in the UAE, Kuwait, and Oman.

Jason Sadler, President of Inter...

Article details

Lira T-bills and Beirut land outperform Dow Jones index. Outpace U.S. three times over in 20 years

Investing in one-year treasury bills or a plot of land in Beirut over the last twenty years generates more returns than U.S. treasury bills and the Dow Jones Industrial Average (DJIA), according to a new article published in the July issue of Lebanon Opportunities.

An initial investment of $100 in local T-bills in 1997 grows to $535 by the end of 2016, thus generating the highest compound annual growth rate (CAGR) of 8.7 percent. The lowest return on investment is made by U.S. T-bills, wi...

Article details

Broken promises on pledges for refugee aid. Only eight percent of required funding has been received

The international community is falling behind in its pledge to help secure over $2 billion in funding, to cover projects that aid Syrian refugees and vulnerable host communities. The UN's Inter-Agency Coordination Office (UN-IAC) said that out of the $2.75 billion appealed in funding requirements for 2017, only eight percent have been received up to the end of March.

Food security received the highest allocation, with $49 million, followed by education.

The energy sector, which was...

Article details

BLOM Bank’s shares yield highest dividend. Audi raises dividend for the first time in recent years

BLOM Bank's common shares have yielded 8.9 percent in dividends for fiscal year 2016, the highest among listed banks.

BLOM was followed by Bank Audi with a dividend yield of 8.3 percent and Byblos Bank with a yield of eight percent. The dividend yields on the common shares of Bank of Beirut and Banque BEMO were 3.5 percent and 3.1 percent respectively.

"Our strategy is to pay a dividend that is not less than the previous dividend payout," said Alexandre Mouradian, head of Investor...

Article details

First electric car to be launched locally. Renault Twizy to retail at $19,900

Renault Twizy, will be launched by Bassoul Heneine, as the first electric car, to the local market.

Joy Zakhour from Bassoul Heneine, said: "We want to be pioneers in the electric cars in the market and we feel that the Twizy will be a good introduction for the Renault Zero Emission vehicles."

Renault Twizy will be available for sale at $19,900 including Value Added Tax (VAT) as of July 12.

The 2018 Twizy comes in three different models. It is a front-wheel drive with 17 ho...

Article details

Kabalan Plast to open plastic furniture factory in Tebna.

Kabalan Plast will open a plastic furniture factory in the Tebna industrial zone. Construction works will be launched early next year and will be completed in 2019.

The 4,000 square meters (m2) built-up factory will be erected on a 6,000 m2 land plot.

Hussein Kabalan, major shareholder, said that the price per m2 in Tebna is $150.

"There is a shortage of industrial zones in the South," he said.

Investment in the project is estimated at $4 million. "I will borrow a...

Article details