Lebanese government increases individual subsidized loans
The Lebanese government agreed to increase the amount of individual subsidized loans to the productive sectors of agriculture, industry and tourism from $3.3 million to $10 million. The Central Bank and the government have developed a plan to process loan applications quickly, and the Central Bank will subsidize part of the interest charges.
Interest on a $3.3 million loan from commercial banks will be capped at 6 percent on US dollar-denominated loans and at 8 percent for Lebanese pound-denominated loans, while loans worth $10 million will have maximum 8 percent on dollar loans and 10 percent on the pound.
The Central Bank mandated that 15 percent of the soft loans must be paid to the banks in the first two years, adding that the aggregate amount of each loan should not exceed 20 percent of a bank’s shareholder equity.
The decision to raise the ceiling on soft loans is part of the government’s efforts to back economically viable sectors, particularly the industrial, agricultural, tourism, information technology, and handicraft sectors. Figures released by the Central Bank for the second quarter of 2000 show that the aggregate amount of subsidized loans to productive sectors in Lebanon reached $205 million since the program was established in the first quarter of 1997. — ( Lebanon Invest )
© 2001 Mena Report (www.menareport.com)