th 4 Arab-Hellenic Economic Forum Athens, 3-4 June, 2015
HEADLINES 1. Arab Economic Overview 2. Lebanon Economic Overview 3. What Are The Investment Opportunities? 4. About IDAL 5. Contact Us
ECONOMIC OVERVIEW Macroeconomic Overview - 2013 1 Arab World World Arab World as % of World 2.853 75.62 3.80% GDP (USD Trillion) 369.8 7,162.1 5.20% Populatjon (million) Labor Force (million) 112 3,314.90 3.40% 8,775.40 134,324.7 6.50% Surface (sq. Km) FDI Inflow (USD billion) 48.5 1,461.00 3.30% FDI Inflow Average Growth 26.1 10.9 - Rate (%) 29.5 - - FDI Outglow (USD billion) Inter - Arab FDI flows 53 - - (USD billion) IDAL | 2015
• UAE and KSA accounted for more than 40% of the overall inward FDI to Arab countries. ECONOMIC OVERVIEW FDI Inflows into the Arab Country 2 INWARD FOREIGN DIRECT INVESTMENT TO ARAB COUNTRIES IN USD BILLIONS (2008-2013) 96.3 83.9 63.9 48.5 47.1 42.9 2008 2009 2010 2011 2012 2013 * Oil Economies IDAL | 2015
ECONOMIC OVERVIEW Outward FDI flows from Arab Countries 3 For the period between 2001 and 2012, Kuwait, UAE, Saudi Arabia and Bahrain accounted for 81% of the total FDIs approximately. - Kuwait ranked 1st with a stake of 34.3% of the total outflows - UAE which ranked 2nd with a stake of 24.3% of the total outflows - Saudi Arabia came in 3rd place with a stake of 13.7%. IDAL | 2015
• Kuwait, Saudi Arabia, UAE and Qatar • Jordan, Bahrain, Kuwait and Saudi ECONOMIC OVERVIEW FDI Inflows into the Arab Country 4 Arabia attracted more than 78% of the total inward inter-Arab investments by 2012, according to the UNCTAD. were the main sources of outward inter-Arab investments representing more than 66% of the total in 2012, according to the UNCTAD. IDAL | 2015
ECONOMIC OVERVIEW Special Programs by the Government to Attract Investments 5 Country Program • financial Incentjve Program” to invest in physical Gold: support investors to own “Visions of Dubai” series of gold coins. • Educatjon Hub: A region intended to attract foreign investment, retain local students, UAE by providing access to high - quality educatjon and create a knowledge - based economy. • Dubai Silicon Oasis Authority, a 100 % government - owned free zone that promotes modern technology based industries • “CADRE” is established by the Saudi Investment authority to find and train local talents KSA to become globally competjtjve, locally employed through innovatjve training and development solutjons. • Establishment of “investment Window” that has full authority of the licensing and Jordan approval processes of new investments within a 30- day tjme frame. In 2015 Egypt's cabinet approved a drafu law on investment. The legislatjon creates a • "one-stop shop" to make Egypt more aturactjve for foreign investment. Egypt The bank devalued the Egyptjan pound by nearly 7% against the U.S. dollar. • The government limited policy and legal uncertainty to aturact private investment by • issuing a law that immunized public contracts from administratjve court oversight. Plans to amend some decrees in Investment Law No. 360 • Programs in place to encourage Business Process Outsourcing • Lebanon Programs in place to attract Diaspora Direct Investments • Rise of incubators and accelerators as well as digital citjes • IDAL | 2015
HEADLINES 1. Arab Economic Overview 2. Lebanon Economic Overview 3. What Are The Investment Opportunities? 4. About IDAL 5. Contact Us
ECONOMIC OVERVIEW LEBANON IN FIGURES 1 GDP: USD 47.5 billion GDP per Capita: USD 10,530.8 Population: 4.5 m illion Urban Population (% of total): 87% Labor Force (million): 1.48 Average Age of Labor Force: 29 years old Languages: Arabic – French – English Average Inflation Rate: 3.5% Unemployment: 13% IDAL | 2015
ECONOMIC OVERVIEW Despite the current geo-political climate, Lebanon continues to attract investments into the country… 2 FDI Inflows to Lebanon (USD billion) (2006-2013) 4.96 4.84 4.33 3.78 3.50 3.38 3.00 2.83 2006 2007 2008 2009 2010 2011 2012 2013 Source: UNCTAD - World Investment Report 2014, IMF IDAL | 2015
ECONOMIC OVERVIEW Relatively to GDP, FDI and FDI stocks to Lebanon remains among the highest, regionally and globally… 3 FDI as % of GDP (2013) FDI Stock as a % of GDP (2013) Lebanon 6.3% Singapore 283% Jordan 5.3% Belgium 182% Sudan 4.4% Lebanon 126% Morocco 3.2% UK 63% 3.1 % Bahrain Bahrain 55% UAE 2.7% France 40% Tunisia 2.3% Canada 35% Egypt 2.0 % 29% USA Oman 2.0% 28% KSA Iraq 1.3% UAE 27% KSA 1.2 % Kuwait 1.2% Germany 23% Algeria 0.8% Source: UNCTAD - World Investment Report 2014, IMF
ECONOMIC OVERVIEW Banking sector performance has also shown resilience as demonstrated by the increasing asset base of banks and the liquidity ratio 4 Evolution of Assets and Deposits (USD billion) (2007 - 2014) 176 165 152 141 129 115 144 136 94 125 82 116 107 96 78 67 2007 2008 2009 2010 2011 2012 2013 2014 Total assets Total Deposits Assets to GDP ratio (2013) Deposits to GDP ratio (2013) 366.1% 302.6 % 161.2% 109.9% 100.5% 94.0% 74.9% 70.3% Lebanon MENA Emerging World Lebanon MENA Emerging World markets markets Source: Audi Bank IDAL | 2015
ECONOMIC OVERVIEW Economic activity in Lebanon has gained traction over the last year as demonstrated by the number of construction permits, and passenger arrival 5 Number of Passengers at the Airport Construction Permits (000s SQM) (2012-2014) (million) (2007-2014) 12,560 13,069 11,727 6.2 5.9 5.6 6.6 5.5 3.3 5.0 4.0 2007 2008 2009 2010 2011 2012 2013 2014 11M-2012 11M-13 11M-14 Source: Audi Bank IDAL | 2015
ECONOMIC OVERVIEW Lebanon offers key advantages to investors through a very sound banking system and minimum restrictions on capital flows 6 Resilient Banking Sector: Restriction on Capital Flows Soundness of Banks Rankings (2010) (2012) Canada Morocco 3.8 1 st Egypt 4.1 Australia 3 nd 5 Turkey Hong Kong 7 th 5.1 Jordan Singapore 8 th KSA 5.3 Chile 11 th UAE 5.5 Qatar 5.7 Lebanon 12 th 5.9 Lebanon Brazil 14 th 5.9 Singapore KSA 16 th Finland 6.1 Luxembourg 18 th Honkong 6.5 Source: World Competitiveness Report (2012) Source: World Economic Forum IDAL | 2015
rates currently countries. adobted in most Lebanon is one of the few countries that still enjoy a flat rate, which is more beneficial to investors than the progressive ECONOMIC OVERVIEW Lebanon has one of the lowest taxation schemes and fiscal charges in the world, with only 15% corporate tax rate 7 Favorable Investment Environment: Corporate Tax Rate (%) 41 Japan 33 France 30 Germany 30 Max Jordan 28 Syria 20 Egypt 20 Turkey 20 KSA 17 Singapore 15 Lebanon 14 Min Jordan 13 Ireland 10 Cyprus Source: Country's Investment Promotion Agencies IDAL | 2015
ECONOMIC OVERVIEW … And pro-business environment 8 Number of Procedures to Number of Days Enforce a Contract to Start a Business (2012) (2012) Sudan 36 Syria 55 Kuwait Kuwait 50 35 UAE 15 UAE 49 Jordan 13 Bahrain 48 Syria 13 Qatar 43 Qatar 13 Egypt 42 Morocco 12 KSA 40 Tunisia 11 Morocco 40 Bahrain 9 Tunisia 39 Lebanon 9 Jordan 38 Egypt 7 Lebanon 37 5 Yemen 36 KSA Source: World Bank (2012) Source: World Bank (2012) IDAL | 2015
the US, and the Arab countries • Many Lebanese students pursue higher education in Europe, • National literacy rates stand close to 90% ECONOMIC OVERVIEW One of the best educational systems internationally, resulting in a trilingual, highly qualified labor force 9 Overall Quality of Education Quality of Math & Science Education Index (2012) (2012 - 2013) 1 st 1 st Singapore Switzerland 2 nd 2 nd Finaland Finland 3 rd Belgium 3 rd Singapore 4 th Lebanon 5 th Belgium Switzerland 5 th Lebanon 10 th Taiwan 6 th Australia 15 th Canada 14 th UAE 17 th UAE 17 th Taiwan, China 24 th Australia 24 th USA 28 th Jordan 28 th Jordan 31 th USA 47 th Source: Global Competitiveness Report (2012 - 2013) Source: Global Competitiveness Report (2012-2013) IDAL | 2015
HEADLINES 1. Arab Economic Overview 2. Lebanon Economic Overview 3. What Are The Investment Opportunities? 4. About IDAL 5. Contact Us
INVESTMENT OPPORTUNITIES Selected on their readiness & potential for development These sectors were included in Law 360 in 2001 EIGHT SECTORS ARE ELIGIBLE FOR OUR FOOD AND INDUSTRY TOURISM BEVERAGES INCENTIVES IDAL PROVIDES INCENTIVES TO EIGHT SECTORS WITH GROWTH POTENTIAL AND READINESS FOR AGRICULTURE INFORMATION TECHNOLOGY DEVELOPMENT TECHNOLOGY TELECOM MEDIA
1 TOURISM A market with high undersupply
• • HEALTHCARE TOURISM SECTOR WHY IS THERE POTENTIAL? WHERE ARE THE OPPORTUNITIES? • One of the fastest growing sector SPAs and wellness centers: in Lebanon, with an average of 13% today there are very few destination wellness resorts in Lebanon and ample opportunities. annual growth recorded between 2005 and 2009. Three-stars and four-stars hotels; there is a high demand for this segment and • Directly contributes to 10% of currently it is under-supplied. the country’s GDP and indirectly to around 35% • One of the largest employer in the country: generating 125,000 direct jobs in 2011 and 448,500 direct and indirect jobs in total • T ourists spending in Lebanon hovers at USD 3,000 per visit, one of the highest rates in the world.
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